ANNUAL  MESSAGE 


OF  THE 


GOYEEN'OE 


OF  THE 


State  of  New  Yoek. 


TRANSMITTED  TO  THE   LEGISLATURE  JANUARY  5,  1875. 


\ 


ALBANY: 

WEED,  PARSONS  AND  COMPANY,  PRINTERS. 
1875. 


Avery  Architectural  and  Fine  Arts  Library 
Gift  of  Seymour  B.  Durst  Old  York  Library 


lEx  HibrtH 


SEYMOUR  DURST 


When  you  leave,  please  leave  this  book 

Because  it  has  been  said 
" Ever' thing  comes  t'  him  who  waits 

Except  a  loaned  book." 


ANNUAL  MESSAGE 


OF  THE 


GOVEKNOK 


OF  THE 


State  of  New  Yoke. 


TRANSMITTED  TO  THE  LEGISLATURE  JANUARY  5,  1875. 


ALBANY: 

WEED,  PARSONS  AJSTD  COMPANY,  PRINTERS. 
1875. 


STATE  OF  NEW  YORK. 


Wo.  3. 


IN  ASSEMBLY, 

January  5,  1875. 


ANNUAL  MESSAGE  OF  THE  GOVERNOR. 


Executive  Chamber,  ) 
Albany,  January  5,  1875.  ) 

To  the  Legislature : 

At  the  advent  of  a  new  year,  when  the  public  bodies  assemble,  to 
consult  in  respect  to  the  affairs,  and  to  transact  the  business  of  the 
State,  our  first  thought  should  be,  to  offer  up  devout  thanksgiving  to 
the  Supreme  Disposer  of  events,  for  the  blessings  which  we  have 
enjoyed  during  the  year  now  closed.  Our  great  Commonwealth  com- 
prises a  population  of  more  than  four  and  a  half  millions  —  largely 
exceeding  that  of  the  whole  United  States  at  the  formation  of  the 
Federal  Government  — and  embracing  vastly  more  extensive  and  diver- 
sified interests  and  activities.  Our  sense  of  duty  ought  to  be  com- 
mensurate with  the  magnitude  of  the  trust  conferred  upon  us  by  the 
people.  Forming,  as  our  State  does,  so  important  a  part  of  the 
American  Union,  the  benefits  of  an  improved  polity,  of  wise  legisla- 
tion, and  of  good  administration,  are  not  confined  to  our  own  citizens, 
but  are  felt  directly  and  by  their  example,  in  our  sister  States,  and  in 
our  national  reputation  throughout  the  world.  Mindful,  with  you,  of 
these  ^usiderations,  I  proceed  to  perform  the  duty  enjoined  by  the 
constiu  n  upon  the  governor,  to  "  communicate,  by  message  to  the 
Legislature,"  "the  condition  of  the  State,"  and  to  "recommend  such 
matters  to  them,  as  he  shall  deem  expedient." 


4 


Governor's  Message. 


RECEIPTS  AND  EXPENDITURES. 

The  receipts  into  and  payments  from  the  Treasury,  on  account  of 
all  the  fuuds,  except  the  Canal  and  Common  School  Funds,  for  the 
fiscal  year  ending  September  30,  1874,  were  as  follows : 

Receipts   $26,  465,  370  43 

Payments   19,  636,  308  36 

Balance  in  the  Treasury  September  30,  1874. .  $6,  829,  062  07 
The  available  balance  amounted  to   $6,  494,  881  44 


The  difference  being  made  up  by  the  defalcation  in  the  State  Treas- 
ury in  1873,  of  $304,957.91,  and  the  sum  of  $29,222.72,  being  an  old 
balance  due  from  the  Bank  of  Sing  Sing. 

STATE  DEBT. 

On  the  30th  of  September,  1873,  the  total  funded  debt  was 
$36,530,406.40,  classified  as  follows: 

General  fund   $3,988,526  40 

Contingent  (stock  issued  to  the  Long  Island  Railroad 

Company)     68,  000  00 

Canal   11,  352,  880  00 

Bounty   21, 121,  000  00 

$36,  530,  406  40 

During  the  months  of  August  and  September,  1873,  stocks  of  the 
Bounty  Loan  were  purchased  to  the  amount  of  $306,000,  but  not  can- 
celed until  after  September  30,  1873.  Deducting  this  sum,  the 
bounty  debt  amounted  to  $20,815,000,  and  the  total  debt  to 
$36,224,406.40. 

On  the  30th  September,  1874,  the  total  funded  debt  was  $30,199,- 
456.40,  classified  as  follows : 

General  fund   $3,  988,  526  40 

Contingent   68,000  00 

Canal   10,  230,  430  00 

Bounty   15,  912,  500  00 

$30,  199,456  40 


Governor's  Message. 


5 


The  actual  reduction  of  the  State  debt  during  the  fiscal  year  ending 
September  30,  1874,  by  cancellation  of  matured  stocks,  and  by  the 
purchase  of  $4,902,500  of  Bounty  Loan  7s  of  1877,  for  the  Bounty 
Debt  Sinking  Fund,  is  $6,024,950. 

In  addition  to  the  $4,902,500  of  Bounty  Stock,  purchased  for  the 
Bounty  Debt  Sinking  Fund  during  the  last  fiscal  year,  and  canceled, 
there  have  been  investments  for  that  sinking  fund,  since  the  date  of 
the  last  report  to  the  present  time,  in  State  Securities  and  Govern- 
ment Kegistered  Bonds  to  the  amount  of  $4,381,500,  at  a  cost  of 
$4,972,091.35;  add  $327,283.88  premium  and  $3,210  commissions 
on  Bounty  Loan  Stock  purchased  and  canceled,  and  $1,421,584,  in- 
terest on  Bounty  Debt,  makes  a  total  of  $11,626,667.23  paid  on  ac- 
count of  this  Sinking  Fund  since  the  date  of  last  report  to  the  present 
time.  The  securities,  now  held  in  trust  for  this  sinking  fund,  amount, 
at  their  par  value,  to  $6,802,944.09,  which  could  be  disposed  of,  at 
the  present  market  rates,  at  an  average  premium  of  over  twelve  per 
cent. 

The  following  statement  shows  the  amount  of  the  State  debt  on  the 
30th  September,  1874,  after  deducting  the  unapplied  balances  of  the 
sinking  funds  at  that  date  : 

Balance  of  sinking   Balance  of  debt 
Debt  on  the  30th      funds    on    30th      after  applying 
September,  1874.        September,  1874.       sinking  funds. 

General  Fund....  $3,988,526  40  $4,142,693  84 

Contingent   68,000  00  32,823  49  $35,176  51 

Canal   10,230,430  00  1,561,018  99  8,669,411  01 

Bounty   15,912,500  00  *7,125,278  20  8,787,221  80 

$30,199,456  40    $12,861,814  52    $17,491,809  32 


The  State  debt  on  the  30th  September,  1873,  after 
deducting  the  unapplied  balances  of  the  sinking  funds, 

amounted  to   $21,191,379  34 

On  the  30th  September,  1874,  to   17,491,809  32 


Showing  a  reduction  of   $3,699,570  02 


*  Deducting  interest  accrued  to  October  1,  1874,  payable  January  1, 1875. 


6 


Governor's  Message. 


TAXES. 

The  State  tax  levy  for  the  current  year  amounted  to  7^  mills. 
The  total  amount  of  the  tax  will  be  $15,727,482.08,  about  $900,000 
in  excess  of  the  amount  levied  during  the  preceding  fiscal  year. 

OTHER  DEPARTMENTS  OF  THE  STATE. 

Summary  statements  in  respect  to  the  Banks,  Savings  Banks,  Trust, 
Loan  and  Indemnity  Companies,  Insurance  Companies,  Quarantine, 
the  Emigration  Commission,  Common  Schools,  Colleges  and  Acade- 
mies, the  State  Library  and  Museum,  the  National  Guard,  the  soldiers 
of  the  war  of  1812,  the  war  claims  against  the  United  States,  the  Salt 
Springs  and  the  State  Prisons,  are  appended.  The  full  reports  of 
the  public  officers  and  boards,  charged  with  the  special  care  of  these 
subjects,  will  be  transmitted  as  soon  as  their  preparation  is  completed. 
Your  attention  is  invited  to  them,  and  especially  to  the  report  of  the 
Comptroller,  which  will  be  submitted  at  the  opening  of  the  session. 

STATE  CENSUS. 

The  Constitution  provides  that  an  enumeration  of  the  inhabitants 
of  the  State  shall  be  taken,  under  the  direction  of  the  Legislature,  in 
the  year  1855,  and  at  the  end  of  every  ten  years  thereafter. 

Chapters  64  and  181  of  the  Laws  of  1855,  and  chapter  34  of  the 
Laws  of  1865,  which  remain  in  full  force,  prescribe  the  manner  of 
taking  the  enumeration. 

These  acts  require  the  Secretary  of  State  to  prepare  uniform  blank 
returns  and  abstracts,  for  the  purpose  of  taking  the  enumeration  and 
obtaining  statistical  information  as  to  population  and  social  statistics, 
the  resources  and  interests  of  the  State,  individual  and  associated 
industry,  agriculture,  the  mechanic  arts,  commerce  and  manufactures, 
education,  and  other  information  of  great  value  to  the  statician  and 
all  classes  of  citizens,  and  will  probably  require  little  or  no  modi 
iication. 

It  will  be  necessary  for  the  Legislature  to  make  an  appropriation  to 
enable  the  Secretary  of  State  to  carry  into  effect  the  provisions  of  the 


Governor's  Message.  7 

Constitution  and  statutes  above  referred  to.  A  sum  equal  to  the 
amount  appropriated  in  1865  for  that  purpose,  by  chapter  598  of  the 
Laws  of  that  year,  will  probably  be  sufficient. 

The  Secretary  of  State  has  taken  preliminary  steps  toward  taking 
the  enumeration,  and  looks  to  the  Legislature  for  an  early  appropria- 
tion to  enable  him  to  go  forward  with  the  work. 

PAUPERISM. 

The  annual  report  of  the  State  Board  of  Charities  will  be  laid 
before  the  Legislature,  and  I  commend  it  to  your  attention.  It  will 
contain  the  results  of  a  special  examination  in  respect  to  the  condition 
of  children  in  the  poor-houses,  and  the  subjects  of  out-door  relief  and 
alien  paupers.  The  laws  relating  to  pauperism  need  revision  and 
amendment.  The  growth  of  the  State  in  wealth  and  population  has 
brought  with  it  more  complex  relations  between  capital  and  labor, 
which  should  be  carefully  studied,  in  order  that  legislation  may  be 
adapted  to  their  requirements.  I  suggest  whether  it  is  not  advisable 
that  a  commission  be  appointed  to  investigate  and  report  upon  the 
management  and  relief  of  the  poor,  and  to  propose  such  legislation  as 
will  tend  to  relieve  the  industry  of  the  State  from  the  evils  which 
result  from  poor  laws,  vicious  or  inadequate  in  conception,  or  defec- 
tive in  execution. 

CENTENNIAL  EXHIBITION. 

The  celebration  of  the  centennial  anniversary  of  American  Inde- 
pendence will  occur  in  the  year  1876.  Under  the  auspices  of  the 
general  government  an  international  exhibition  of  arts,  manufac- 
tures and  natural  products  will  be  held  in  the  city  of  Philadelphia. 
Provision  has  already  been  made  for  the  appointment  of  a  board  of 
five  commissioners  to  represent  this  State,  who  are  to  serve  without 
compensation.  I  recommend  a  moderate  appropriation  of  money, 
which  will  be  required  to  defray  the  necessary  expenses  of  the  com- 
mission, and  enable  this  State  to  take  such  part  in  the  exhibition  as 
will  testify  our  sense  of  the  greatness  of  the  event  commemorated, 
and  is  suitable  to  the  dignity  of  our  Commonwealth. 


8 


Governor's  Message. 


CONSTITUTIONAL  AMENDMENTS. 

The  adoption  of  the  recent  amendments  to  the  Constitution  ren- 
ders necessary  some  important  legislation  in  order  to  carry  them  into 
full  effect.  The  changes  made  in  article  2  require  corresponding 
changes  in  the  election  laws,  with  respect  to  challenges  and  the  oaths 
thereupon,  and  the  enactment  at  the  present  session  of  a  law  "  exclud- 
ing from  the  right  of  suffrage  all  persons  convicted  of  bribery  or  of 
any  infamous  crime." 

The  amendment  of  section  4  of  article  8  of  the  Constitution, 
requires  the  enactment  of  a  "  general  law  conforming  all  charters  of 
savings  banks,  or  institutions  for  savings,  to  a  uniformity  of  powers, 
rights  and  liabilities." 

The  addition  of  article  15  necessitates  the  passage  of  an  act  pre- 
scribing the  punishment  for  the  offense  of  bribery  created  in  sections 
1  and  2.  Some  legislation  may  be  necessary  in  consequence  of  the 
change  in  the  mode  of  compensating  members  of  the  Legislature,  and 
in  some  other  matters  which  will  readily  occur  to  you. 

The  section  added  to  article  3  as  section  18  requires  the  passage  of 
general  laws,  providing  for  the  cases  in  which  special  legislation  is 
prohibited  by  that  section.  Many  of  these  cases  are  within  existing 
general  laws,  and,  with  respect  to  several  others,  no  immediate  legis- 
lation seems  to  be  required.  Doubtless,  however,  some  legislation  is 
expedient,  either  in  the  way  of  enacting  statutes  providing  for  the  cases 
to  which  the  existing  statutes  do  not  apply,  or  in  the  way  of  amend- 
ments to  existing  statutes. 

The  provision  prohibiting  special  legislation  in  the  cases  specified 
is  the  amendment,  from  which  the  largest  benefits  have  been  antici- 
pated. In  framing  the  general  laws  which  are  to  provide  for 
these  cases,  great  caution  will  be  necessary.  The  part  I  took  in 
the  Convention  of  1846,  and  even  before  the  enactment 
of  the  general  banking  law  of  1838,  in  advocating  the 
principle  of  general  laws  in  its  application  to  the  creation  of  cor- 
porate bodies  which  had  been  practical  monopolies,  and  to  other  cases 
where  it  seemed  to  be  safely  applicable,  may  justify  me  in  sug- 
gesting some  qualification  of  the  advantages  to  be  derived  from  the 
change,  unless  it  be  accompanied  by  especial  foresight  and  wisdom. 


Governor's  Message. 


9 


It  will  doubtless  be  an  unavoidable  necessity  to  modify  existing 
general  laws,  and  to  shape  new  ones  to  be  enacted  with  reference  to 
special  and  peculiar  cases.  It  is  quite  possible  to  give  "a  general  form 
to  the  phraseology  of  every  enactment  intended  to  apply  to  a  special 
case,  and  to  operate  as  a  special  grant  of  powers. 

The  benefit  intended  to  be  secured  by  the  prohibition  may  thus 
be  defeated.  Even  greater  mischiefs  than  those  which  existed  under 
the  old  system  may  be  created. 

The  parties  interested  in  promoting  a  law  intended  to  obtain  special 
powers  for  a  particular  case,  cannot  be  relied  on  to  guard  against  the 
possible  operation  of  the  general  provision  in  the  other  cases  to  which 
it  may  be  applied.  The  legislators,  who  could  measure  the  whole 
consequences  of  an  act  limited  in  its  terms  to  a  special  instance,  can- 
not foresee  the  possible  cases  to  which  a  general  law  adapted  to  the 
instance  present  to  his  mind,  may  be  found  capable  of  applying,  or 
what  operation  it  may  have.  There  will,  therefore,  be  great  danger 
of  vague,  loose  and  hasty  legislation  in  contemplation  of  one  object, 
but  capable  of  working  in  numerous  cases  results  neither  foreseen  or 
intended. 

The  new  legislation  called  for  by  this  provision  should  be  framed 
with  more  than  ordinary  care. 

FRAUDS  AND  MALVERSATION  BY  PUBLIC  OFFICERS. 

It  will  be  the  first  and  most  imperative  of  our  duties  to  revise  the 
laws  which  are  intended  to  provide  criminal  punishment  and  civil 
remedies  for  frauds  by  public  officers,  and  by  persons  acting  in  com- 
plicity with  them.  The  condition  of  our  existing  statutes  and  of  our 
unwritten  law,  as  its  provisions  for  such  cases  have  been  construed 
and  declared  by  recent  decisions  of  the  court  of  final  resort,  disclose 
grave  defects.  The  practical  evils  resulting  from  these  defects  are 
greatly  increased  by  the  recent  frequency  and  magnitude  of  violations 
of  official  trust. 

IMPERFECTION  OF  CRIMINAL  LAWS. 

The  statutes  punishing  embezzlement  are  held  not  to  apply  to  such 
offenses,  when  committed  by  public  officers.    The  statutes  relating  to 
larcenies  are  deemed  to  be  of  questionable  application  to  a  fraudulent 
2 


10 


Governor's  Message. 


acquisition  of  public  funds,  existing  in  the  form  of  credits  inscribed  on 
the  books  of  a  bank,  and  known  in  the  lauguage  of  commerce  as 
deposits.  The  statutes  in  regard  to  obtaining  money  or  property  by 
false  pretenses,  are  not  free  from  technical  embarrassments  in  their 
application  to  public  frauds.  Without  assenting  to  the  conclusion 
that  these  statutes  are  wholly  unavailable  in  such  cases,  it  cannot  be 
doubted  that  they  are  inadequate,  unfit  for  the  exigencies  of  the  times, 
aud  that  they  abound  in  needless  technical  questions  which  tend  to 
the  defeat  of  public  justice. 

JSTo  illustration  of  these  defects  can  be  so  impressive,  as  certain 
facts  of  recent  experience.  A  public  officer  designated  by  statute  of 
the  State,  and  authorized,  with  two  others,  to  audit  the  then  existing 
liabilities  against  the  county  of  New  York,  fraudulently  made  an 
audit,  or  certified  to  an  audit  not  made,  of  fictitious  claims  to  the 
amount  of  six  millions  of  dollars,  and  instantly  received  a  million 
and  a  half  of  the  money  paid  on  such  audits,  through  a  common 
agent  between  himself  and  the  pretended  owners  of  the  claims. 
For  this  flagrant  crime,  accompanied  by  many  circumstances  of  aggra- 
vation, the  eminent  counsel,  who  represented  the  people,  deemed  it 
prudent  to  seek  convictions  only  for  misdemeanors  in  neglect  of  offi- 
cial duty,  the  punishment  for  each  of  which  is  imprisonment  in  the 
penitentiary  for  a  term  not  exceeding  one  year,  and  a  fine  not  exceed- 
ing two  hundred  and  fifty  dollars.  When  we  consider  that  a  person, 
who,  under  the  temptation  of  pressing  want,  steals  property  of  the 
value  of  over  twenty -five  dollars,  is  liable  to  imprisonment  in  the 
State  prison  for  a  term  of  five  years,  and  that  the  other  offenses 
against  private  property  are  punishable  with  corresponding  seventy, 
the  inadequacy  of  the  law  applicable  to  great  public  delinquents, 
betraying  the  highest  trusts,  and  plundering  the  people  on  a  grand 
scale,  is  revolting  to  all  just  notions  of  morality  and  justice. 

RECOMMENDATIONS. 

I  recommend  the  enactment  of  a  statute  whicli  shall  clearly  embrace 
such  offenses,  and  impose  penalties  upon  them  proportionate  to  their 
moral  turpitude  and  to  the  mischief  which  they  inflict  upon  society. 
It  can  apply  only  to  future  cases;  but  it  may  be  expected  to  dp 
something  toward  preventing  a  recurrence  of  such  evils. 


Governor's  Message. 


11 


CIVIL  REMEDIES. 

The  existing  civil  remedies  applicable  to  such  cases  are  no  less 
inadequate.  For  the  last  three  years,  the  spectacle  has  been  exhibited 
on  the  conspicuous  theater  of  our  great  metropolis,  of  fraudulent 
officials  remaining  in  quiet  possession  and  making  unobstructed  dis- 
positions of  great  wealth,  which  we  are  morally  certain  was  derived 
from  their  spoliation  of  public  trusts,  notwithstanding  legal  proof  of 
the  most  conclusive  nature  exists  of  their  guilt.  In  the  meantime, 
civil  actions  have  been  dragging  their  slow  length  along,  as  in  ordi- 
nary cases  of  disputed  rights,  while  the  "  laws  delay  "  has  been  main- 
tained by  the  use  of  the  vast  fund  abstracted  from  the  public,  and  no 
process  has  been  found  in  our  laws  by  which  it  could  be  attached  and 
preserved  pending  the  litigation,  or  its  disposition  interfered  with 
before  final  judgment. 

RECOMMENDATION. 

•  A  bill  to  extend  to  such  cases  the  remedy  of  attachment  as  in  case 
of  foreign  corporations,  or  non-resident,  absconding,  or  concealed 
defendants,  has  been  heretofore  submitted  to  the  legislature.  I  trust 
that  such  a  measure  will  be  speedily  adopted.  I  recommend,  further, 
that  preference  be  given  to  such  cases  in  the  courts,  whoever  may  be 
the  party  plaintiff. 

A  GREAT  DEFECT  IN  OUR  JURISPRUDENCE. 

A  still  more  serious  defect  exists  in  our  jurisprudence.  Where  a 
wrong  is  committed,  which  affects  the  treasury  of  a  city,  county,  town 
or  village,  the  officers  who  would  be  the  proper  plaintiffs  in  any  suit 
for  redress,  or  who  possess  exclusively  the  power  to  institute  or  con- 
duct such  suits,  may  be  themselves  the  wrong-doers,  or  be  in  com- 
plicity with  the  wrong-doers.  In  every  such  case,  the  remedy  must, 
of  course,  be  very  much  embarrassed,  if  not  wholly  unavailing.  The 
unfaithful  inenmbents  may  be  entitled  to  serve  for  a  long  term,  or 
they  may  possess  great  facilities  for  gaining  the  favor  of  their  suc- 
cessors. While  the  remedy  is  thus  delayed  —  perhaps  for  years  — 
the  proofs  may  be  lost ;  or  the  depredators  may  make  away  with  their 


12 


Governor's  Message. 


property,  and  withdraw  their  persons  from  the  reach  of  process ;  or 
they  may,  through  the  lapse  of  time,  become  discharged  from  liability 
by  the  statute  of  limitations.  As  the  offense  becomes  stale,  the 
public  sentiment,  which  inspires  voluntary  efforts  of  patriotic  citizens 
in  behalf  of  the  people  to  seek  redress,  is  wearied  and  weakened. 
On  the  other  hand,  temptations  are  strengthened  and  developed  into 
actual  crimes  by  the  prospect  of  impunity,  which  grows  out  of  tardi- 
ness and  uncertainty  in  the  remedial  law. 

ATTEMPTS  TO  REMEDY  THAT  DEFECT. 

The  frequent  occurrence  of  malversation  in  local  governing  officials, 
has  stimulated  ingenuity  to  devise  some  judicial  remedy.  At  first  it 
was  conceived  that  the  injured  tax  payers  or  inhabitants  might,  in 
their  own  names,  invoke  judicial  aid.  An  analogy  was  set  up  to  the 
case  of  a  private  corporation  in  which  a  corporator,  on  the  omission 
of  the  directors  to  sue,  might  bring  an  action,  in  behalf  of  himself 
and  his  associates,  making  the  corporate  body  a  defendant.  The  idea 
received  much  favor  from  the  courts  in  the  judicial  district  which 
comprises  the  city  of  New  York. 

But  the  Court  of  Appeals  in  Roosevelt  v.  Draper,  and  in  DoolitUe 
v.  Supervisors  of  Broome  County,  decided  that  the  individual  tax 
payer  had  no  special  interest  distinct  from  that  of  the  public,  which 
would  enable  him  to  sustain  an  action,  in  person,  for  the  redress  of  a 
public  wrong  of  the  nature  involved  in  those  cases.  In  the  former 
case,  the  intimation  was  made,  that  the  true  "  remedial  process  against 
an  abuse  of  administrative  power  tending  to  taxation,  is  furnished  by 
our  elective  system,  or  by  a  proceeding  in  behalf  of  the  State in  the 
latter,  that  "  for  wrongs  against  the  public,  the  remedy,  whether  civil 
or  criminal,  is  by  a  prosecution  instituted  by  the  State  in  its  political 
character,  or  by  some  officer  authorized  by  law  to  act  in  its  behalf." 

The  whole  reasoning  of  the  court  proceeded  upon  this  ground,  nor 
does  it  seem  to  have  been  questioned  by  the  counsel  on  either  side. 
The  remedy  intimated  in  these  decisions  has  been  recognized  as  estab- 
lished law  in  Great  Britain,  from  which  we  inherit  our  equity  juris- 
prudence, by  a  series  of  great  precedents.  It  has  been  applied  to 
populous   municipalities,  like  Liverpool,  and   to  corporate  funds 


Governor's  Message. 


13 


derived  from  taxation,  and  applicable  to  general  municipal  purposes. 
It  is  a  natural  deduction  from  the  historic  origin  and  the  expansive 
philosophy  of  the  equity  system,  whose  proud  boast  has  ever  been 
that  it  leaves  no  wrong  without  a  remedy. 

On  the  discovery  in  1871  of  the  frauds  committed  by  the  govern 
ing  officials  of  the  municipality  of  New  York,  the  Attorney-General, 
acting  on  these  intimations  of  our  own  courts  and  on  the  English 
precedents,  instituted  actions  against  the  parties  inculpated  by  posi- 
tive proofs.  Within  the  last  year  the  Court  of  Appeals,  in  the  cases 
of  The  People  v.  Tweed,  Ingersoll  et  al.,  and  of  The  People  v.  Fields, 
has  decided  that  the  State  cannot  maintain  those  actions.  The  result 
is  at  last  arrived  at,  that  neither  the  taxpayer,  nor  the  State  in  his 
behalf,  can  seek  redress ;  that  in  all  the  long  interval,  nobody  has 
been  competent  to  sue  or  conduct  a  suit,  except  some  corporation 
counsel  who  was  an  appointee  of  the  accused  parties.  This  is  a  state 
of  our  jurisprudence  which  calls  for  new  legislation. 

NEW  LEGISLATION. 

In  choosing  between  the  two  expedients  of  vesting  the  right  to 
sue  in  the  individual  taxpayer  or  in  the  State,  it  is  obvious  that  the 
latter  should  be  preferred.  The  existing  statutes  intended  to  confer 
some  limited  rights  on  the  individual  taxpayer,  are  practically  nuga- 
tory. The  reasoning  of  the  Court  of  Appeals,  in  the  cases  denying 
him  the  right  under  our  customary  jurisprudence  or  the  common 
law,  argues  with  cogency  the  inconveniences  which  might  attend  the 
possession  of  such  a  power  by  every  member  of  so  multitudinous  a 
body.  The  wiser  alternative  is  to  vest  the  power  in  the  people  of 
the  State,  acting  by  their  Attorney-General.  It  will  be  analogous  to 
the  authority  which  exists  in  respect  to  private  corporations  and  in 
cases  of  nuisances,  and  of  quo  warranto:  and  will  be  in  conformity 
to  the  safe  methods  and  traditional  usages  of  equity  jurisprudence. 

LOCAL  SELF-GOVERNMENT. 

The  establishment  of  such  a  remedy  for  the  injured  taxpayer  or 
citizen  will  not  detract  from,  but  will  make  possible,  and  will  found 


14 


Governor's  Message. 


on  a  durable  basis  local  self-government.  Human  society  will 
struggle,  like  every  tiling  that  lives,  to  preserve  its  own  existence. 
When  abuses  become  intolerable,  to  escape  them  it  will  often  surren- 
der its  dearest  rights. 

All  the  invasions  of  the  rights  of  the  people  of  the  city  of  New 
York  to  choose  their  own  rulers  and  to  manage  their  own  affairs  — 
which  have  been  a  practical  denial  of  self-government  for  the  last 
twenty  years  —  have  been  ventured  upon  in  the  name  of  reform, 
under  a  public  opinion  created  by  abuses  and  wrongs  of  local  adminis- 
tration, that  found  no  redress.  When  the  injured  taxpayer 
could  discover  no  mode  of  removing  a  delinquent  official,  and 
no  way  of  holding  hijn  to  account  in  the  courts,  he  assented 
to  an  appeal  to  the  legislative  power  at  Albany;  and  an  act 
was  passed  whereby  one  functionary  was  expelled,  and  by  some 
device  the  substitute  selected  was  put  in  office.  Differing  in  poli- 
tics as  the  city  and  State  did,  and  with  all  the  temptations  to  indi- 
vidual selfishness  and  ambition  to  grasp  patronage  and  power,  the 
great  municipal  trusts  soon  came  to  be  the  traffic  of  the  lobbies.  It  is 
long  since  the  people  of  the  city  of  New  York  have  elected  any 
Mayor  who  has  had  the  appointment,  after  his  election,  of  the  impor- 
tant municipal  officers.  Under  the  charter  of  1870  and  again  under 
the  charter  of  1873,  the  power  of  appointment  was  conferred  on  a 
Mayor  already  in  office.  There  has  not  been  an  election  in  many 
years,  in  which  the  elective  power  of  the  people  was  effective  to  pro- 
duce any  practical  results,  in  respect  to  the  heads  of  departments  in 
which  the  actual  governing  power  really  resides. 

A  new  disposition  of  the  great  municipal  trusts  has  been  generally 
worked  out  by  new  legislation.  The  arrangements  were  made  in 
secret.  Public  opinion  had  no  opportunity  to  act  in  discussion,  and 
no  power  to  influence  results.  Inferior  offices,  contracts,  and  some- 
times money  were  means  of  a  competition,  from  which  those  who 
could  not  use  these  weapons  were  excluded. 

Whatever  defects  may  sometimes  have  been  visible  in  a  system  of 
local  self-government,  under  elections  by  the  people,  they  are  infin- 
itely less  than  the  evils  of  such  a  system,  which  insures  bad  govern- 


Governor's  Message. 


15 


ment  of  the  city,  and  tends  to  corrupt  the  legislative  bodies  of  the 
State. 

A  popular  election  invokes  publicity  —  discussion  by  the  contend- 
ing parties  —  opportunity  for  new  party  combinations,  and  all  the 
methods  in  which  public  opinion  works  out  results. 

OFFICIAL   ACCOUNTABILITY  A   CONDITION   OF   MUNICIPAL  INDEPENDENCE. 

No  part  of  the  civic  history  of  this  State  is  more  instructive  than 
the  recorded  debates  of  the  Convention  of  1821,  on  the  question  of 
electing,  by  the  voters  of  the  counties,  the  sheriff,  who  is  the  execu- 
tive arm  of  the  State.  It  wa6  thoughtfully  considered  by  our  fore- 
most statesmen.  Its  solution  embraced  the  two  ideas  —  the  selection 
by  the  locality,  and  the  removal  for  cause  by  the  State.  The  Con- 
vention of  1846  carried  its  dispersion  of  the  power  of  choosing  local 
officers,  much  farther,  on  the  same  system.  That  system  is  to  dis- 
tinguish between  the  power  of  electing  or  appointing  the  officer  and 
the  power  to  hold  him  to  account.  It  is,  while  dispersing  the  one  to 
the  localities,  to  reserve  the  other  to  the  State,  acting  by  its  general 
representatives,  and  as  a  unit;  to  retain  in  the  collective  State  a 
supervisory  power  of  removal,  in  addition  to  whatever  other  accounta- 
bility may  result  to  the  voters  or  authorities  of  the  locality,  from  the 
power  to  change  the  officer  at  the  expiration  of  his  term,  or  from 
special  provisions  of  law. 

The  two  ideas  are  not  incompatible.  On  the  contrary,  each  is  the 
complement  of  the  other.  Such  dispersion  of  the  appointing  power 
has  become  possible,  only  because  these  devices  have  been  invented 
to  preserve  accountability  to  the  State. 

The  right  of  the  State,  by  its  general  representatives  to  remove,  is 
capable  of  being  made  to  destroy  the  local  election  or  appointment. 
The  right  of  the  State  to  sue  is  not.  It  is  less  in  conflict  with  the 
local  power  of  election  and  appointment.  Official  accountability  is 
not  complete  if  there  is  no  remedy  for  official  wrongs  but  removal. 
That  remedy  needs  to  be  supplemented  by  accountability  in  the  courts 
on  the  appeal  of  a  taxpayer  or  citizen  of  the  locality.  If  a  right  to 
that  appeal  is  denied,  the  appeal  will  continue  to  be  made,  on  often 


16 


Governor's  Message. 


recurring  occasions,  to  the  legislative  power;  and  the  system  oi  the 
last  twenty  years  will  be  perpetuated. 

MUNICIPAL  PROBLEM. 

The  problem  of  municipal  government  is  agitating  the  intellect  of 
all  civilized  peoples.  In  our  own  State  it  is  the  more  interesting  and 
important  because  it  involves  the  half  of  all  our  population,  which 
lives  in  cities  or  large  villages. 

The  frame-work  of  the  system  which  we  should  adopt  must  be 
intrenched  in  the  fundamental  law;  and  protected,  by  constitutional 
restrictions,  from  arbitrary  and  capricious  changes  by  legislation. 
This  problem  failed  of  any  solution  in  the  recent  amendments  to  the 
Constitution.  It  is  worthy  of  long  continued  thought  and  debate. 
Time  and  discussion  will  at  last  mature  a  safe  and  wise  result. 

THE  ERIE  CANAL  AND  THE  TRANSPORTATION  PROBLEM. 

The  State  of  New  York,  not  denying  the  general  unfitness  of  gov- 
ernment to  own,  construct  or  manage  the  works  which  afford  the 
means  of  transportation,  saw  an  exception  in  the  situation,  and  in  the 
nature  of  the  canals,  which  are  trunk  communications  between  the 
Hudson  and  the  great  inland  seas  of  the  North  and  West.  They 
connect  vast  navigable  public  waters,  and  themselves  assume  some- 
thing of  a  public  character. 

THE  NATURAL  PASS  OF  COMMERCE. 

The  voyage  from  Europe  to  America,  even  if  destined  to  Southern 
ports,  is  deflected  by  the  ocean  currents  so  as  to  pass  closely  by  the 
gates  of  our  commercial  metropolis.  That  capacious  harbor  is  open 
the  whole  year,  accessible  in  all  prevailing  winds,  is  sheltered,  safe 
and  tranquil.  From  it  the  smooth  waters  of  the  Hudson  give  transit  to 
the  lightest  hull,  carrying  the  largest  cargo,  which  the  skill  of  man 
has  brought  into  use.  The  head  of  navigation  on  the  Hudson  touches 
the  natural  pass  of  commerce,  opened  up  in  the  geographical  config- 
uration of  this  continent,  where  the  Alleganies  are  cloven  down  to 


Governor's  Message. 


17 


their  base,  and  travel  and  traffic  are  allowed  to  flow  accross  on  a 
level  and  by  the  narrowest  isthmus,  to  the  lake  ports,  which  connect 
with  all  that  great  system  of  inland  water  communication  and  interior 
commerce,  the  most  remarkable,  in  its  character  and  extent,  and  acces- 
sories, that  exists  in  any  part  of  the  globe 

THE  NORTHWEST. 

Tributary  to  the  western  centres  of  lake  commerce,  such  as 
Chicago  and  Milwaukee,  are  vast  areas  of  fertile  soils,  which  stretch 
to  and  partly  include  the  valley  of  the  Upper  Mississippi.  Open 
prairies,  easily  brought  into  cultivation,  fitted  for  the  use  of  agricul- 
tural machinery,  adapted  to  the  cheap  construction  of  railways,  and 
peculiarly  dependent  on  their  use  as  a  means  of  intercourse  and 
traffic,  have  been  opened  to  settlers  at  nominal  prices.  They  have 
been  rapidly  filled  by  a  young,  intelligent  and  energetic  population, 
trained  in  the  arts  and  industries  of  an  older  civilization,  and  apply- 
ing them  to  natural  advantages  which  have  been  found  elsewhere, 
only  in  conjunction  with  the  social  barbarism  of  an  uninhabited  wil- 
derness. They  are  now  covered  with  a  net  work  of  railways,  which 
connect  myriads  of  little  centres  with  the  lake  ports  and  with  the 
trunk  railways,  that  bring  them  into  practical  contiguity  to  our  great 
Eastern  centres  of  population,  capital,  commerce  and  manufactures. 

new  York's  liberal  policy  —  the  erie  canal  trust. 

New  York,  without  arrogating  to  itself  an  undue  share  in  these 
achievements,  may  contemplate  with  proud  satisfaction  its  contribu- 
tion to  results  so  magnificent.  Important  as  are  the  advantages 
which  have  accrued  to  itself,  it  has  not  sought  to  monopolise  the 
benefits  of  its  policy.  The  price  of  such  cereals  and  other  products 
of  agriculture  as  are  exported  in  considerable  quantities,  are  mainly 
fixed  by  the  competitions  of  the  foreign  markets,  even  for  our  own 
consumption.  The  cheapening  of  the  cost  of  transit,  therefore,  chiefly 
profits  the  producer.  This  consideration  illustrates  how  large  and 
liberal,  in  the  main,  is  the  policy  adopted  by  the  State  —  a  policy 
3 


18 


Governor's  Message. 


which  I  had  the  satisfaction  of  advocating  in  1846  and  1867  —  of 
treating  these  great  works  as  a  trust  for  the  million,  and  not  seeking 
to  make  revenue  or  profit  for  the  sovereign  out  of  the  right  of  way. 
In  consonance  with  the  same  policy,  was  the  action  of  the  State  in 
1851,  in  permitting  the  transit  free  of  tolls,  upon  a  railway  which  it 
allowed  to  be  constructed  between  the  termini  of  the  Erie  canal  and 
along  its  bank.  It  had  originally  undertaken  the  construction  and 
administration  of  the  canal,  in  order  to  create  a  facile  and  cheap 
transportation  demanded  by  the  interests  of  the  people,  and  not 
otherwise  possible  to  be  attained.  It  did  not  fbrget  the  motive  for 
which  it  had  acted,  and  remember  only  its  selfish  interests  as  a  pro- 
prietor. It,  therefore,  by  an  act  which  anticipated  the  necessity 
afterward  to  arise  by  the  construction  of  rival  routes,  repealed  all 
restraints  on  the  carriage  of  property,  and  opened  to  free  competition 
every  mode  of  transit,  even  in  rivalry  to  its  own  works,  for  the  pro- 
ducts of  the  west  and  for  the  manufactures  and  merchandise  of  the 
east. 

NOT  TO  BE  ABANDONED. 

The  Erie  Canal  remains  an  important  and  valuable  instrument  of 
transport,  not  only  by  its  direct  services,  but  by  its  regulating  power 
in  competition  with  other  methods  of  transportation.  The  State,  so 
far  as  we  can  now  foresee,  ought  to  preserve  it,  and  not  contemplate 
its  abandonment. 

DUTIES  OF  THE  STATE. 

If  the  State  accepts  the  view  which  commands  it  to  abstain  as  a 
proprietor  from  making  profit  out  of  the  canal,  but  to  deal  with  it  as 
a  trust,  it  still  has  great  duties  to  perform.  It  is  bound,  as  a  faithful 
trustee,  to  protect  this  great  work,  not  only  from  a  spoliation  of  its 
revenues  'and  from  maladministration,  but  from  empirical  changes, 
proposed  in  the  seductive  form  of  specious  improvements  that  would 
destroy  its  usefulness  while  charging  it  with  new  incumbrance  ;  and 
from  an  improvident  tampering  with  its  incomes  that  would  dissipate 
its  means  of  effecting  real  improvements. 

These  are  its  ever-recurring  and  its  greatest  perils. 


Governor's  Message. 


10 


LAKE  AND  CANAL  NAVIGATION  CANNOT  BE  ASSIMILATED. 

The  925  miles  of  lake  navigation  from  Chicago  to  Buffalo,  and  the 
495  miles  of  canal  and  river  navigation  from  Buffalo  to  New  York, 
and  the  3,000  miles  of  ocean  navigation  from  New  York  to  the  Old 
World,  cannot  be  made  homogenous  or  even  assimilated  ;  each  is  sub- 
ject to  physical  conditions  which  are  unchangeable,  and  to  which  the 
vehicle  of  transportation  must  be  adapted. 

LAKE  BOATS  UNFIT  AS  CANAL  BOATS. 

The  rough  and  stormy  lakes  req  uire  a  strong  vessel,  made  seaworthy 
by  its  deep  keel,  fully  manned,  and  of  a  form  intended  for  speed 
in  an  unlimited  expanse  of  water.  The  canal  admits  of  a  light  keel, 
and  a  shape  which  will  carry  a  larger  proportional  cargo  ;  for  the  boat 
moves  safely  in  a  tranquil  channel  of  water,  closely  confiued  by  physi- 
cal boundaries  on  the  bottom  and  sides,  and  cannot  but  submit  to  a 
slow  movement. 

The  propellor  of  the  lakes  tends  to  grow  in  dimensions.  A  recent 
one  carries  70,000  bushels  of  wheat,  or  2,100  tons.  A  barge  to  be 
towed  by  each  propellor  is  a  system  now  being  tried  with  fair  pros- 
pects of  success. 

The  lake  craft  of  the  average  size  carries  less  cargo  in  proportion 
to  the  vessel  than  the  canal  boat ;  and  it  costs  twice  and  a  half  or 
three  times  as  much  as  the  canal  boat  per  ton  of  capacity. 

If  the  Canal  were  made  large  enough  to  pass  the  lake  craft,  the 
transporter  could  not  afford  to  use  the  lake  craft  on  the  canal.  It 
carries  too  little  cargo  —  it  is  too  costly  —  it  would  have  to  reduce  its 
rate  of  motion  from  about  eight  miles  per  hour  on  the  lake  to  less 
than  three  miles  per  hour,  which  is  the  highest  aim  of  the  canal  boats, 
that  now  make  only  ly4-^  miles  per  hour. 

Such  a  vehicle  of  transport  would  not  be  adapted  to  the  water 
channel  it  must  move  in,  and  would  not  be  economical.  Tranship- 
ment at  Buffalo,  with  modern  machinery,  would  cost  little,  compared 
with  the  loss  incident  to  using  an  unfit  and  illy  adapted  instrument. 

To  enlarge  the  Erie  canal  to  dimensions  adapted  to  the  movement 
of  such  a  vessel,  at  the  rate  of  less  than  three  miles  per  hour,  would 


20 


Governor's  Message. 


be  so  inconvenient  to  the  traffic,  that  it  would  be  easier  and  cheaper 
to  construct  an  independent  work.  That  would  probably  cost  a 
principal  sum,  the  annual  interest  on  which  would  be  greater  than 
the  entire  amount  now  received  by  the  carrier  for  his  services,  and  by 
the  State  for  its  tolls  on  all  the  existing  business.  A  shorter  route 
would  be  likely  to  be  preferred.  The  Hudson  river,  from  Troy  to 
deep  water,  would  need  a  similar  reconstruction. 

ENLARGED  LOCKS  AND  UNENLARGED  WATER-WAY. 

A  project  often  urged  within  the  last  ten  years  is  the  enlargement 
of  the  locks  and  other  structures  of  the  Erie  canal,  without  a  propor- 
tionate enlargement  of  the  waterway.  That  plan  exhibits  a  singular 
union  of  injurious  costliness  and  fatal  parsimony.  It  is  founded  on  the 
fallacy  that  the  use  of  a  large  boat,  without  reference  to  its  adaptation 
to  the  waterway  in  which  it  is  to  move,  would  be  economical.  It  is 
supported  by  an  estimate  of  the  State  Engineer  in  186-i,  that  the  cost 
of  transportation  would  be  reduced  one-half.  His  opinion  has  been 
repeated  on  all  occasions  until  the  present  time. 

But  that  estimate,  when  analyzed,  is  found  to  omit  all  the  wages 
and  support  of  the  crew  during  the  return  trip,  and  during  the  time 
occupied  in  loading  and  unloading,  and  to  allow  for  the  use  of  the 
boat  about  half  its  real  cost.  In  other  respects,  it  was  utterly 
unworthy  of  trust. 

ECONOMY  FROM  THE  BEST  GROUP  OF  ADAPTATIONS. 

The  truth  is,  the  boat  is  but  one  part  of  the  whole  machine  of 
transportation  ;  economy  in  the  service  depends  upon  getting  the  best 
adaptation  of  all  the  various  parts  —  the  boat  —  the  motive  power  — 
the  canal,  with  its  structures  and  its  waterway ;  the  best  group  of 
adaptations  which  adjustments  and  compromises  of  each  can  work  out 
and  combine ;  and  the  resultant  of  the  greatest  economies  which  can 
be  obtained  in  conjunction. 

A  larger  boat,  in  a  waterway  which  now  needs  to  be  itself  enlarged 
and  improved  to  give  a  good  transit  to  the  present  boat,  would  be  an 
unmixed  damage  to  the  economy  of  the  service,  attained  at  immense 
cost. 


Governor's  Message. 


21 


PERFECTING  THE  CANAL  THE  WISE  POLICY. 

The  Erie  canal  was  planned  in  view  of  the  best  science  and  expe- 
rience then  possessed.  It  has  excellent  adaptations.  It  is  a  superior 
instrument  of  transportation.  It  should  not  be  fundamentally  changed 
in  its  character  and  conditions  without  great  consideration.  It  should 
be  perfected,  and  so  made  available  to  every  practicable  extent,  for 
facilitating  and  cheapening  the  exchanges  of  commodities  between 
the  East  and  the  West. 

ITS  CAPACITY  ITS  ECONOMY. 

The  two  questions  concerning  it  are :  first,  its  capacity  to  do  an 
aggregate  business  during  a  given  period ;  secondly,  the  economy  per 
ton  per  mile  of  the  transportation  it  affords.  These  questions  are 
generally  confused  in  all  discussions.  They  are  completely  distinct. 
They  depend  upon  wholly  different  conditions. 

ITS  CAPACITY  AMPLE. 

Capacity  to  accommodate  an  aggregate  tonnage  during  a  day,  a 
month,  or  a  season  of  navigation,  depends  on  the  number  of  boats  of 
the  normal  size  which  the  locks  are  able  to  pass  during  the  period. 
Boats  can  be  multiplied  indefinitely.  The  limit  to  their  use  is  in  the 
number  to  which  the  locks  can  give  transit.  The  time  occupied  in  a 
lockage  is  the  test.  But  it  is  unnecessary  to  apply  that,  for  the  actual 
results  of  experience  set  at  rest  every  doubt. 

Of  the  seventy-two  locks  which  intervene  between  the  waters  of 
Lake  Erie  and  the  waters  of- the  Hudson,  all  but  a  few  have  been 
doubled  for  many  years.  In  1867,  when  the  subject  was  discussed  in 
the  Constitutional  Convention,  thirteen  remained  single.  For  the 
first  time,  on  the  opening  of  navigation  next  spring,  double  locks 
will  be  brought  into  use  throughout  the  entire  canal.  That  will 
nearly  double  the  capacity  of  the  canal  to  make  lockages.  The  largest 
delivery  of  the  Erie  Canal  at  tide-water  was  in  1862.  It  amounted 
to  2,917,094  tons,  in  cargoes  averaging  167  tons.  The  lockages  both 
ways,  and  including  rafts  which  pass  only  one  way, —  at  Alexander's, 
which  is  in  the  throat  of  the  canal,  three  miles  west  of  Schenectady,— 


22 


Governor's  Message. 


was  34,977.  In  1873,  the  deliveries  were  2,585,355  tons,  in  cargoes 
averaging  213  tons,  and  the  lockages  were  21,960. 

The  theoretical  capacity  of  the  canal  will  be  three  or  four  times  the 
largest  tonnage  it  has  ever  reached.  There  is  no  doubt  it  can  con- 
veniently and  easily  do  double  the  business  which  has  ever  existed, 
even  though  the  locks  be  not  manned  and  worked  with  the  highest 
efficiency.  The  subject  of  capacity  may,  therefore,  be  dismissed  from 
this  discussion. 

ECONOMY  PER  TON  PER  MILE. 

The  question  really  worthy  of  our  attention  is  how  we  can  perfect 
the  canal,  so  as  to  reduce  the  cost  per  ton  per  mile  of  the  transporta- 
tion it  affords. 

Quickening  the  movement  of  the  boat  increases  the  service  it  ren- 
ders in  a  given  period.  It  lessens  every  element  in  the  cost  of  that 
service.  It  enlarges  the  number  of  tons  carried  in  the  given  time, 
and  by  enlarging  the  divisor  of  the  same  expenses,  it  reduces  the  rate 
of  cost  per  ton  per  mile. 

TO  BE  INCREASED  BY  PERFECTING  WATER-WAY. 

The  economy  in  the  transit  of  the  boat  must  be  made,  not  in  the 
locks,  but  in  the  water-way.  The  72  locks  in  the  315  miles  between 
Buffalo  and  West  Troy,  if  each  takes  five  minutes,  would  occupy 
exactly  six  hours. 

In  October,  1873,  76  boats  were  timed,  and  their  average  passage 
down,  with  average  cargoes  of  227  tons,  wras  10  days,  2  hours  and 
46  minutes,  or  nearly  243  hours.  If  we  double  the  time  taken 
in  the  locks,  the  time  occupied  on  the  levels  between  them  would  still 
be  over  95  per  cent  of  the  whole  time  of  the  voyage.  It  is  clear,  there- 
fore, that  the  saving  of  time  must  be  made  in  the  95  per  cent,  and  not 
in  the  five  per  cent.  Economy  per  ton  per  mile  in  the  transportation, 
so  far  as  it  depends  on  the  structure  of  the  canal,  is  to  be  found  in  the 
relation  which  the  water-way  bears  to  the  boat. 

The  movement  of  the  boat  through  water  confined  in  an  artificial 
channel  —  narrow  and  shallow  —  is,  at  best,  very  slow.  The  engin- 
eers, in  1835,  planned  the  Erie  Canal  and  the  boat  with  such  relations 


Governor's  Message, 


23 


to  each  other  as  to  give  the  greatest  economy  of  power  and  facility  of 
transit.  The  boat  has  inclined  to  grow  rather  large  and  too  square. 
The  water-way  was  practically  never  excavated  in  every  part  to  its 
proper  dimensions.  Time,  the  action  of  the  elements,  and  neglect  of 
administration,  all  tend  to  till  it  by  deposits.  I  may  be  excused  for 
repeating  here  what  I  said  in  the  Constitutional  Convention  eight 
years  ago : 

"  What  the  Erie  Canal  wants  is  more  water  in  the  prism  —  more 
water  in  the  water-way.  A  great  deal  ot  it  is  not  much  more  than 
six  feet,  and  boats  drag  along  over  a  little  skim  of  water  ;  whereas  it 
ought  to  have  a  body  of  water  larger  and  deeper  even  than  was  inten- 
ded in  the  original  project.  Bring  itnp  to  seven  feet — honest  seven 
feet  —  and  on  all  the  levels,  wherever  you  can,  bottom  it  out ;  throw 
the  excavation  upon  the  banks ;  increase  that  seven  feet  toward  eight 
feet,  as  you  can  do  so,  progressively  and  economically.  You  may 
also  take  out  the  bench-walls." 

RECOMMENDATIONS. 

I  recommend  that  such  measures  be  taken  as  your  wisdom,  aided 
by  such  information  as  can  be  had  from  the  proper  administrative 
officers,  may  devise,  to  put  in  good  condition  and  to  improve  the 
water-way  of  the  Erie  Canal ;  and  that  provision  be  made  by  law  to 
enable  the  State  Engineer,  soon  after  navigation  is  opened,  to  measure 
the  depth  of  water  in  the  canal  by  cross-sections  as  often  as  every 
four  rods  of  its  length,  and  on  the  upper  and  lower  mitre-sill  of  each 
lock. 

FUTURE  INVENTIONS  AND  ECONOMIES. 

Such  a  policy,  if  properly  executed,  will  give  a  better  and  more 
economical  transit  to  the  boats,  if  they  continue  to  be  towed  by  horses. 
It  will  also  facilitate  the  use  of  steam  canal  boats,  and  the  full  reali- 
zation of  the  advantages  they  may  be  expected  to  give  as  to  economy 
of  transportation.  The  obstacle  to  their  use  in  1867  was  that  the 
machinery,  in  its  then  state,  displaced  too  much  cargo  to  be  economi 
cal,  and  was,  in  other  respects,  imperfect.  The  progress  of  invention 
since  seems  to  promise  more  beneficial  results.    If  the  movement  of 


24 


Governor's  Message. 


the  boat  can  be  expedited  from  1  ^  miles  to  3  miles  per  hour, 
including  the  time  consumed  in  the  lockages,  the  improvement  will 
be  of  great  importance  and  value.  The  estimate  of  the  able  engi- 
neer of  the  Commission  on  Steam  Canal  Navigation,  is  that  the  cost 
of  carriage  of  a  bushel  of  wheat  from  Buffalo  to  New  York  will  be 
reduced  from  eight  cents  to  four  cents.  It  is  not  to  be  supposed  that 
the  inventive  genius  applied  to  this  interesting  subject  is  exhausted, 
and  if  these  results  shall,  in  any  degree,  fail  to  be  realized  by  the 
present  experiments,  we  may,  nevertheless,  anticipate  more  complete 
success  in  the  future. 

INCOME  AND  OUTGO. 

It  will  be  seen  that  on  the  Erie  canal  alone  the  surplus  of  income 
over  expenditures  is  about  37£  per  cent  of  the  gross  income.  If  the 
three  other  canals  which  are  to  be  retained  by  the  State  as  part  of  the 
system  be  included,  the  surplus  is  but  11  |  per  cent. 

TOLLS. 

The  present  tolls  on  wheat  are  3  yV  cents,  and  on  corn  3  cents  per 
bushel,  from  Buffalo  to  Troy  —  345  miles.  They  were  reduced  in 
1870  —  those  on  wheat  from  6^,  or  one-half;  and  those  on  corn 
from  4  -j^j-  to  3  cents,  or  about  38  per  cent. 

One  cent  per  bushel  taken  off  the  present  tolls,  and  the  same  pro- 
portion on  other  articles,  would  annihilate  nearly  all  the  net  income 
of  the  Erie  canal,  considered  alone,  and  would  make  a  deficiency,  in 
respect  to  the  four  canals  retained,  of  half  a  million  of  dollars  a  year, 
if  future  expenditure  should  be  the  same  as  in  these  three  years. 

The  construction  of  the  details  of  the  toll  sheet  belongs  to  the 
Canal  Board,  and  adjustments  from  time  to  time  may  be  necessary. 
Doubtless  suggestions  on  that  subject  will  always  receive  due  consider- 
ation. But  in  the  present  condition  of  things  to  embark  hastily  and 
unadvisedly  upon  a  general  reduction  of  tolls  might  well  be  consid- 
ered as  improvident,  even  in  respect  to  the  canals  themselves.  To  con- 
fiscate the  surplus  of  one  cent,  or  half  a  cent  per  bushel,  which 
alone  gives  the  means  of  making  the  improvements  expected  to  real- 
ize a  reduction  of  four  cents  in  the  cost  of  transportation,  would  not 


Governor's  Message. 


25 


seem  a  wise  execution  of  the  trust,  even  disregarding  other  consider- 
ations which  cannot  be  wholly  overlooked. 


NO    RASH  INNOVATIONS. 

The  question  of  altering  the  gates  of  the  locks,  or  otherwise 
lengthening  the  chambers,  may  be  safely  deferred  until  we  can  be 
more  sure  of  its  utility.  The  fact  that,  on  the  Delaware  and  Karitan 
Canal,  which  admits  of  long  boats,  the  proportions  which  exist  in 
those  now  used  on  the  Erie  canal  are  preferred,  is  against  that  altera- 
tion, as  is  also  the  judgment  of  excellent  canal  engineers.  Holding 
ourselves  ready  to  accept  improvements  which  have  been  sub- 
jected to  trial  and  scrutiny,  until  they  are  practically  assured  of 
success,  we  ought  to  exercise  the  same  caution,  in  respect  to  rash  or 
crude  innovations,  which  ordinarily  governs  men  in  private  business. 

FINANCIAL  RESULTS  OF  THE  LAST  THREE  YEARS. 

The  financial  results  of  the  fiscal  years  ending  September  30,  1874, 
1873  and  1872,  for  the  Erie  canal,  and  for  the  Champlain,  the 
Oswego,  and  the  Cayuga  and  Seneca,  are  as  follows: 


ERIE. 

Year 

end'g  Extraordinary  Total  expendi- 

Sept.  30.           Income.  Ordinary  repairs.  repairs.  ture. 

1872.  $2,760,147  50  $1,025,079  09  $661,942  02  $1,687,021  11 

1873.  2,710,601  49  749,977  03  967,175  39  1,717,152  42 

1874.  2,672,787  22  701,340  81  973,548  96  1,674,889  77 


143,536  21  $5,079,063  30 


Income  in  excess  of  disbursements   $3,064,472  91 

Average  for  each  year   1,021,490  97 


CHAMPLAIN. 


1872..  $150,644  28  $236,211  47  $251,871  61  $488,083  08 
1873..  153,417  86  234,677  37  562,782  95  797,460  32 
1874..      123,703  54       203,137  90       242,216  43       445,354  33 


$427,765  68 


4 


$1,730,897  73 


26 


Governor's  Message. 


Excess  of  expenditure  over  income   $1,303,132  05 

Average  for  each  year   434,377  35 


OSWEGO. 

Year 

end'g                                                                         Extraordinary  Total  expendi- 

Sept.  30.             Income.            Ordinary  repairs.             repairs.  tare. 

1872..      $90,796  57     $171,794  82     $141,673  94  $313,468  76 

1873..       88,428  13        93,938  80        78,880  58  172,819  39 

1874..       70,119  59       107,938  21        75,561  29  183,499  50 

$249,344  29  $669,787  65 

Excess  of  expenditure  over  income   $420,443  36 

Average  for  each  year   140,164  45 


CAYUGA  AND  SENECA. 

1872..      $17,882  58       $38,267  23       $26,319  00  $64,586  23 

1873..       22,481  11        27,143  48          6,921  06  34,064  54 

1874..       19,311  47        28,934  08        28,517  04  57,451  12 

$59,675  16  $156,101  89 


Excess  of  expenditure  over  income   $96,426  73 

Average  for  each  year   32, 142  42 


RECAPITULATION  FOR  THREE  YEARS. 

Income  over  Expenditure. 

Erie  $3,064,472  91 

Excess  of  Expenditure  over  Income. 


Champlain  $1,303,132  05 

Oswego   420,443  36 

Cayuga  and  Seneca   96,426  73 

  1,820,002  14 

$1,244,470  77 

Each  year   414,823  59 


THE  PAYING  CANALS. 

It  will  be  seen  that  during  the  last  three  years  the  income  of  the 
Erie  canal  considered  alone,  has  been  $8,143,536.21,  and  its  expenses 
$5,079,063.30,  yielding  a  surplus  of  $3,064,472.91,  or  an  average  for 


Governor's  Message. 


27 


each  year  of  $1,021,490.97.  The  excess  of  expenditure  over  income 
of  the  three  other  canals  which  are  to  be  retained  by  the  State  has 
been  $1,820,002.14,  or  three-fifths  of  the  surplus  produced  by  the  Erie. 
Considering  the  four  as  a  system  collectively,  the  surplus  has  been 
$1,244,470.77,  or  an  average  for  each  year  of  $414,823.59. 

THE  NON-PAYING  CANALS. 

During  the  same  three  years  the  five  other  canals,  to  which  the  con- 
stitutional amendment  applies,  have  given  an  income  of  $119,864,45, 
or  for  each  year  of  $39,954.81,  against  an  expenditure  of  $1,596,499.74, 
or  for  each  year  of  $532,166.59.  They  have  consumed  all  the  net 
income  of  the  paying  canals  and  have  charged  the  State  with  a  loss 
of  $232,164.52,  or  for  each  year,  $77,388.17.  In  addition  to  this 
annual  loss,  the  whole  burden  of  the  sinking  fund  to  pay  the  Canal 
debt  is  thrown  upon  the  State. 

INCREASE  INCOME  BEFORE  DISCARDING  INCOME. 

A  careful  investigation  whether  the  net  incomes  of  the  canals 
retained  cannot  be  increased,  ought  to  precede  a  surrender  of  what 
little  now  exist.  Ordinary  repairs  should  be  scrutinized  with  a  view 
to  retrenching  their  cost,  and  to  obtaining  the  largest  possible  results 
from  the  outlay.  Extraordinary  repairs  include  much  which  so  reg- 
ularly recurs  in  different  forms,  that  they  must  be  considered  a  part 
of  the  maintenance  of  the  works.  No  doubt  they  also  include  im- 
provements which  are  of  the  nature  of  new  capital.  These  and  all 
improvements  should  be  governed  by  a  plan  and  purpose,  leading  to 
definite  results ;  and,  instead  of  scattering  expenditures  on  imperfect 
constructions,  should  aim  to  complete  and  make  available  the  specific 
parts  undertaken.  Unity  of  administration  and  of  system,  both  in 
respect  to  repairs  and  improvements,  should  be  established,  even  if 
only  by  the  voluntary  consultation  and  co-operation  of  officers  having 
authority  over  separate  portions  of  a  single  work.  It  is  worthy  of 
consideration,  whether  any  legislation  can  aid  in  securing  the  unity 
in  this  respect,  which  existed  under  our  former  Constitution. 


28 


Governor's  Message. 


NEW  YORK  THE  TRUSTEE  FOR  THE  INTERESTS  OF  ALL. 

The  State,  hearing  all  parties  interested  in  the  use  of  the  Canals, 
will  remember  that  itself,  as  an  arbiter  and  trustee,  must  look  equit- 
abl}r  to  the  interests  of  all.  This  it  will  do  in  a  wise,  liberal  and  just 
spirit.  To  the  last  degree  possible,  it  will  cheapen  facilities  to  trade. 
It  will  aim  to  preserve  for  its  metropolis  its  position  as  the  carrier, 
merchant  and  banker  of  the  New  World. 

CHIEF  FUNCTION  OF  THE  CANAL  SYSTEM  NEW  YORK  CITY. 

Inevitable  changes  must  be  recognized  as  the  results  of  modern 
inventions  and  improvements  in  the  machinery  of  transportation. 
When  water  routes  alone  existed,  products  came  to  New  York  for 
distribution  to  points  which  are  now  more  easily  and  cheaply  reached 
directly  by  rail.  Railroads  covering  the  country  like  a  net  work 
touch  so  many  points  that  they  are  a  more  perfect  and  complete 
agency  for  the  reception  and  distribution  of  produce,  than  a  water 
communication  connecting  a  few  principal  poin  ;  and  where  the 
transit  from  the  producer  to  the  consumer  requires  the  use  of  the  rail 
to  reach  the  water,  or  after  leaving  the  water,  or  both,  the  all  rail 
route  will  often  be  preferred.  New  routes  will  acquire  the  business 
which  is  naturally  tributary  to  them,  and  take  besides  some  portion  ot 
the  general  business.  The  main  transportation  of  Western  agricul- 
tural products  is  for  local  consumption  in  the  East.  What  comes  to 
us  for  our  own  consumption  cannot  be  diverted.  What  goes  for  con- 
sumption elsewhere  cannot  be  acquired.  The  exports  of  agricultural 
products  to  foreign  countries  are  but  a  small  part  of  the  whole  pro- 
duction. In  those,  New  York  will  easily  continue  to  maintain  her 
pre-eminence. 

The  Champlain  and  Oswego  canals  are,  as  well  as  the  Erie,  in  some 
sense,  trunk  canals ;  and  the  Cayuga  and  Seneca  canal  connects  our 
interior  lakes.  It  is  a  noteworthy  fact  that  Mr.  Flagg,  who  so  long 
and  honorably  conducted  the  State  finances  when  the  Canal  Depart- 
ment was  a  bureau  in  his  office,  always  insisted  that  with  the  four 
canals  now  to  be  retained  the  system  was  complete.  Those  it  is 
now  proposed  to  abandon  are  not  fruits  of  his  policy. 


Governor's  Message.  29 

disposition  of  the  non-payino  canals 

The  adoption  of  the  constitutional  amendment  removing  the  pro- 
hibition against  "selling,  leasing,  or  otherwise  disposing  of"  the 
canals  owned  by  the  State,  in  respect  to  all  except  the  Erie,  the 
Oswego,  the  Champlain  and  the  Cayuga  and  Seneca  canals,  undoubt- 
edly contemplate  such  action  on  your  part  as  will  disencumber  the 
revenues  of  the  canals  retained  by  the  State,  and  disembarrass  the 
treasury  of  the  State  from  the  unproductive  works  in  respect  to 
which  the  prohibition  is  withdrawn.  It  cannot  have  been  supposed 
possible  to  "  sell  or  lease  "  those  works,  on  conditions  which  require 
the  purchaser  to  maintain  and  operate  them.  To  "  otherwise  dis- 
pose of"  them  amounts  to  a  practical  abandonment. 

USE  AS  FEEDERS. 

Even  to  deal  with  them  thus  involves  many  important  questions 
of  a  business  character.  Those  portions  of  them  which  descend 
toward  the  Erie  canal  act  as  feeders  to  supply  water  to  that  canal. 
The  supply  cannot  be  safely  diminished,  and  might  be  judiciously 
increased.  The  improvement  of  the  water-way  contemplated  will 
call  for  more  water.  The  consideration  of  what  must  be  done  to 
retain  as  feeders,  portions  of  these  canals  not  hereafter  to  be  main- 
tained by  the  State  for  navigation,  or  wdiat  other  provision  for  a 
supply  of  water  shall  be  substituted,  is  important.  To  make  the 
change  contemplated  by  the  amendment,  with  as  little  harm  as  possi- 
ble to  private  interests,  and  to  consider  and  provide  for  cases  of 
possible  damage  which  may  be  caused  by  the  works  when  falling  into 
disuse,  needs  careful  study  of  the  facts  of  the  situation.  It  is  also  to 
be  ascertained  what  portion,  if  any,  of  the  property  of  the  State 
connected  with  these  works  can  be  wisely  sold. 

A  SPECIAL  COMMISSION  RECOMMENDED. 

The  best  suggestion  which  occurs  to  me  on  this  subject,  is  to 
impose  the  duty  of  considering  and  reporting  on  these  questions  upon 
a  special  commission  consisting  of  four  persons.    In  the  meantime, 


30 


Governor's  Message. 


no  expenditures  should  be  made  upon  those  works,  which  are  not 
strictly  necessary  in  view  of  their  probable  future. 

THE  INTEREST  OF  NEW  YORK  IN  THE  FINANCIAL  POLICY  OF  THE  UNITED 

STATES. 

The  State  of  New  York  receives  nearly  seven-tenths  of  all  the 
imports,  and  sends  abroad  nearly  half  of  all  the  exports  of  the  whole 
United  States.  In  its  commercial  metropolis,  a  much  larger  share  of 
our  dealings  with  foreign  nations  in  securities  and  money  is  trans- 
acted, and,  as  at  a  common  mart,  the  exchanges  are  largely  made 
between  the  people  of  the  United  States  in  domestic  manufactures 
and  products,  and  in  public  and  corporate  securities  and  stocks. 
More  than  one-half  of  the  revenues  of  the  Federal  Government  are 
collected  within  its  borders ;  and  at  least  one-fifth  of  all  Federal 
taxation  falls  upon  its  citizens. 

Since  the  Federal  Government  has  assumed  to  provide  a  currency 
for  the  whole  country,  directly  by  the  issue  of  its  own  notes,  or 
indirectly  by  bank  notes,  which  are  secured  upon  bonds  of  the  United 
States,  and  in  case  of  default  by  the  issuer,  are  to  be  paid,  before 
resorting  to  the  securities,  by  the  United  States;  since  it  has  inci- 
dentally absorbed  the  regulation  of  the  business  of  banking;  since  it 
has  largely  increased  its  taxation,  and  imposes  that  taxation  in  forms 
which  affect  the  courses  of  industry  and  the  application  of  capital  and 
labor,  it  is  impossible  to  exclude  these  vast  operations,  and  the  admin- 
istrative policy  and  the  legislation  connected  with  them,  from  a 
review  of  "  the  condition  of  the  State,"  which  it  is  the  constitutional 
duty  of  the  Governor  to  communicate  with  such  recommendations 
"  as  he  shall  judge  expedient,"  "  to  the  Legislature  at  every  session." 

CAN  MORE  CURRENCY  REVIVE  PROSPERITY. 

The  illusion  is  too  common  that  an  additional  issue  of  currency  in 
legal  tenders  or  bank  notes,  would  alleviate  the  distress  now  felt  in 
business,  cause  a  general  rise  of  prices,  and  revive  a  seeming,  if  not  a 
real,  prosperity.  Thus  many  are  tempted  to  desire  or  to  acquiesce 
in  a  demand  upon  the  Federal  Government  to  put  out  new  promises 


Governor's  Message. 


31 


to  pay,  while  it  is  yet  in  a  long-continued  default  as  to  those  heretofore 
made ;  and  to  do  so  after  ten  years  of  peace,  while  having  no  better 
excuse  for  its  present  default,  than  lack  of  skill  in  applying  its  abund- 
ant resources  to  the  restoration  of  the  public  faith. 

The  hope  of  benefits  to  any  class  from  such  an  unsound  policy, 
would  prove  to  be  completely  fallacious  It  would  prolong  and 
intensify  the  evils  sought  to  be  alleviated.  This  conclusion  is  clear 
upon  principle,  and  in  our  own  experience.  In  order  distinctly  to 
see  its  truth,  it  is  only  necessary  to  analyze  that  function  in  the  busi- 
ness of  society,  which  is  performed  by  the  circulatory  credits  known 
as  currency. 

CURRENCY  BUT  A  PART  OF  CIRCULATING  CREDITS. 

To  economize  the  use  of  metallic  money,  which  had  become  the 
common  instrument  of  exchange,  personal  credit,  in  the  form  ot 
book  accounts,  was  introduced.  For  example,  the  farmer  delivered 
to  the  country  merchant  his  grain  when  ready  for  the  market,  and 
the  merchant  delivered  his  goods  at  the  times  when  they  were  wanted 
by  the  farmer  for  consumption ;  each  delivery  was  entered  in  a  run- 
ning account,  until  a  balance  was  struck,  and  even  then  the  settle- 
ment generally  took  place  without  the  intervention  of  money,  which 
neither  party  had  the  capital  to  own  for  each  transaction,  or  to  pay 
the  ultimate  balance.  Next  came  the  note  of  hand,  and,  when  the  trans- 
action was  between  parties  doing  business  at  different  places,  drafts  and 
bills  of  exchange.  At  last  the  most  refined  tool  of  commerce  became 
perfected.  The  bank  note,  promising  to  pay  coin  on  demand,  to  bearer, 
in  an  even  and  convenient  amount,  engraved  and  authenticated  — 
when  issued  by  an  institution  or  individual  of  established  general 
credit  —  was  voluntarily  accepted  by  everybody  in  place  of  coin.  It 
is  the  currency  used  in  payment  by  those  who  do  not  keep  bank 
accounts,  and,  in  petty  transactions,  by  those  who  do  keep  bank 
accounts.  A  credit  inscribed  on  the  books  of  the  bank,  known  in 
the  language  of  commerce  as  a  deposit,  and  transferred  by  check,  is 
the  preferred  medium  of  payment,  in  all  save  petty  transactions,  by 
those  who  keep  bank  accounts.  It  is  preferred  because  a  check  may 
represent  a  large  and  uneven  amount,  which  in  notes  would  be  incon- 


32 


Governor's  Message. 


venient  in  the  counting,  handling  and  custody  ;  and  a  check  payable 
to  order  is  safer,  and  is  itself  an  evidence  of  the  payment.  In  dense 
communities,  where  the  bank  is  near  the  customers,  checks  are  mostly 
used.  In  sparse  communities,  where  the  bank  is  remote  from  the 
dealers  and  holders,  bank  notes  are  mostly  used. 

These  two  tools  of  trade  and  mediums  of  payment  are,  in  their 
general  functions,  perfectly  identical. 

BANK  NOTES  AND  CHECKS   THE  8AME   IN  EFFECT  AND  NATURE. 

Their  real  nature  is,  that  they  are  a  provision  for  expected  pay- 
ments, and  a  reserve  for  possible  payments.  On  deposits,  the  holder 
submits  to  a  partial  or  total  loss  of  interest,  for  some  banks  allow 
interest,  at  low  rates,  on  deposits ;  on  bank  notes,  the  holder  sub- 
mits to  a  total  loss  of  interest.  To  each  holder  the  motive  is  ever 
present,  to  reduce  his  non-interest  bearing  reserve  to  the  lowest 
necessary  amount,  by  investing  it,  if  it  be  his  own,  or  by  returning 
it,  if  it  be  borrowed. 

THEIR  AMOUNT  VARIED  BY  PEOPLE  S  WANTS,  IF  PAYABLE  IN  COIN. 

If  the  currency  be  redeemable,  the  wants  of  the  community,  and 
not  the  wishes  of  the  banks,  will  determine  the  amount  which  will 
remain  outstanding.  All  that  government  ought  to  do  toward 
fixing  that  amount,  is  to  provide  methods  to  enforce  payment  by 
the  issuers  of  such  notes  as  the  holders  not  wishing  to  use  return  to 
the  issuers  for  redemption. 

AMOUNT  FLUCTUATES  WITH  THE  TIMES. 

It  is  true  that,  in  times  of  speculation,  the  currency  increases. 
Transactions  become  more  numerous.  Higher  prices  cause  the 
same  transactions  to  absorb  more  of  the  medium  of  payment. 
There  is  greater  disposition  to  provide  for  contemplated  or  possible 
operations.  There  is  less  care  to  economize  the  loss  of  interest  on 
the  amount  kept  on  hand.  In  times  of  depression  all  these  condi- 
tions are  reversed.  During  the  long  period  of  downward  tenden- 
cies, from  1837  to  1842,  the  currency  fell,  of  itself,  to  about  one- 
half  its  amount  at  the  beginning  of  the  period. 


Governor's  Message. 


33 


THE  RELATION  OF  CURRENCY  TO  PRICES. 

In  the  ordinary  and  regular  relations  between  a  redeemable  cur- 
rency and  prices,  the  fluctuations  in  the  currency  follow,  instead  of 
preceding,  changes  in  general  prices.  The  notes  in  the  hands  of 
the  public,  less  the  reserve  kept  for  their  redemption,  form  a  part 
of  the  loan  fund  of  a  bank,  but  that  amount  is  not  capable  of  being 
increased  at  the  will  of  the  bank,  until  a  speculation  has  arisen,  and 
higher  prices  or  more  transactions  have  resulted. 

Even  then,  the  increase  of  currency  merely  provides  for  the  prior 
increase  of  prices  or  of  transactions.  It  may  be  said,  that  the 
increase  of  currency  is  a  condition  without  which  the  increase  ot 
prices  or  transactions  could  not  happen,  but  that  is  not  true,  unless 
it  be  shown  that  no  other  tool  of  credit  than  bank  notes  could  be 
used. 

In  cases  where  a  bank  originates  a  speculation  by  enlarging  its 
loans,  it  must  do  so  at  the  expense  of  its  customary  reserve. 

It  is  only  artificial  changes  in  the  currency  —  generally  made  by 
government  —  that  the  currency  itself  becomes  the  primal  source 
of  speculation.  In  fact,  it  nearly  always  happens  that  speculative 
purchases  are  originally  made  on  personal  credit,  evidenced  by  open 
accounts  or  notes  of  hand.  The  banks  are  applied  to  only  at  the 
expiration  of  the  original  credit ;  and  then  what  is  wanted  is  not  a 
continued  use  of  bank  notes,  but  a  loan  of  capital.  Bank  notes  are 
one  of  the  wheels  in  the  machinery  of  credit.  They  have  no  qual- 
ity peculiar  in  its  action  on  prices,  or  different  in  its  action  on  prices, 
from  any  other  part  of  the  machinery  of  credit.  The  currency, 
at  its  present  amount  of  bank  notes  and  legal  tenders,  is  less  than 
the  deposits,  and  is  but  a  small  fraction  of  the  whole  existing  mass 
of  credits,  including  book  accounts,  notes  of  hand,  drafts  and  bills 
of  exchange.  And  new  forms  of  credit  machinery  are  capable  of 
being  invented  indefinitely  as  when,  in  September,  1873,  the  New 
York  Associated  Banks  created  a  currency  of  twenty  millions  of 
certificates,  to  be  used  in  the  exchanges  between  themselves. 

5 


34 


Governor's  Message. 


BUT  CURRENCY  ONLY  SMALL  PART  OF  CIRCULATORY  CREDITS. 

It  is  idle  to  pronounce  the  machinery  of  credit  a  maniac,  dan- 
gerous to  the  community,  and  then  to  put  only  its  little  linger  in 
a  straight-jacket. 

EXPERIENCE  OF  ENGLAND. 

The  experiment  of  regulating  the  note  circulation  only  has  been 
completely  tried  in  Great  Britain.  In  1844,  when,  on  the  re-charter 
of  the  Bank  of  England,  the  bank  note  circulation  of  that  country 
was  subjected  to  rules  which  were  supposed  to  make  it  fluctuate 
exactly  as  if  it  were  coin,  it  was  thought  by  all  but  a  few  great 
thinkers,  that  there  would  ever  after  be  stability  of  prices  and  sta- 
bility of  business.  But  in  1847,  in  1S57,  and  in  186G,  commercial 
revolutions  of  undiminished  severity  demonstrated  the  fallacy  ol 
these  hopes,  and  of  the  system  on  which  they  were  founded. 
While  the  note  circulation  has  ever  since  been  confined  by  law  to  a 
nearly  constant  amount,  the  deposit  circulation  has  increased  many 
fold.  The  vicissitudes  of  credit  are  as  violent  as  ever.  It  is  appar- 
ent that  whenever  a  foreign  demand  for  coin  arises,  not  caused  b> 
domestic  overtrading,  the  system  creates  an  artificial  scarcity  of  an 
important  instrument  of  commerce,  and  subjects  all  business  to  an 
unnecessary  perturbation  ;  that,  whenever  a  panic  destroys  the 
credit  of  inferior  dealers,  and  the  interposition  of  the  highest  credit 
is  called  for  to  supply  the  vacuum  and  revive  confidence,  the  system 
breaks  down  —  the  law  limiting  the  issues  of  bank  notes  is  sus- 
pended with  the  approval  of  the  Ministry,  and  with  a  promise  to 
appeal  to  Parliament  for  an  act  of  indemnity. 

WHY  AND  HOW  INCONVERTIBLE  CURRENCY  DEPRECIATES. 

The  depreciation  of  a  currency,  not  convertible  into  coin,  repre- 
sents the  interest  and  risk,  as  estimated  by  the  judgment  of  inves- 
tors, on  a  loan  payable  at  the  will  of  the  government,  without 
interest  —  subject  to  such  temporary  fluctuations,  as  are  induced  by 
the  variations  in  the  supply  and  demand  of  coin  in  which  that  loan 
is  ultimately  payable. 


Governor's  Message. 


35 


THUS  INFLATING  PRICES. 

There  is  no  doubt  that  the  issue  of  le^al  tenders  during  the  civil 
war  hastened  and  greatly  increased  that  inflation  of  prices,  which 
naturally  resulted  from  the  increased  consumption  and  the  waste 
caused  by  military  operations,  and  from  the  diminished  production 
occasioned  by  so  large  a  withdrawal  of  workers  from  their  ordinary 
industries. 

It  is  the  nature  of  credit  to  be  voluntary.  It  is  founded  on  con- 
fidence. Credit,  on  compulsion,  is  a  solecism.  So  that  a  forced 
loan  of  capital  from  all  existing  private  creditors  cannot  but  be 
costly. 

LEGAL-TENDER  FINANCING. 

It  was  made,  in  this  instance,  on  a  security  which  bore  no  inter- 
est, and  interest  on  which  could  only  be  represented  in  discount 
from  its  par  value.  It  gave  to  the  lender  an  agreement  to  pay, 
which,  being  instantly  due  on  demand,  started  in  its  career  a  broken 
and  dishonored  promise.  Every  successive  holder  was  left  to  con 
jecture  when  it  would  be  redeemed  by  the  issuer  —  how  far  it  might 
be  absorbed  in  the  Treasury  receipts  —  whether  it  could  still  be 
paid  out  to  some  private  creditor  —  at  what  loss  it  could  be  passed 
away  in  new  purchases,  on  a  market  advancing  rapidly  and  irregu- 
larly. Everybody  was  advised  that  the  Federal  Government  —  un- 
wisely distrusting  the  intelligence  and  patriotism  of  the  people  — 
shrank  from  exercising  its  borrowing  power,  supplemented  by  its 
taxing  power ;  that,  instead  of  resorting  at  once  to  the  whole  capi- 
tal of  the  country  capable  of  being  loaned,  which  forms  a  vast  fund, 
perhaps  thirty  or  forty  times  as  large  as  the  then  existing  currency, 
it  chose  to  begin  by  debasing  that  comparatively  insignificant  part 
of  circulating  credits,  creating  fictitious  prices  for  the  commodities  and 
services  for  which  it  was  next  to  exchange  its  bonds,  in  an  expenditure 
ten  times  as  large  as  the  whole  amount  of  the  legal  tenders  it  ven- 
tured to  put  afloat.  No  man  could  know  how  often  or  how  much 
of  legal  tenders  might  be  issued,  under  possible  exigencies  of  the 
future.  It  could  not  be  wholly  forgotten  that  such  issues,  made  by 
our  ancestors  to  sustain  the  victorious  war  for  national  independence, 


36 


Governor's  Message. 


were  never  redeemed,  while  the  public  loans  made  for  the  same 
purposes  were  all  paid.  It  was  remembered  that  history  affords 
other  warning  examples  to  the  same  effect.  These  elements  of  dis- 
trust were  needlessly  invoked.  But  the  system  stopped  short  of  the 
logical  completeness  of  the  expedients  of  the  French  Convention  in 
1793.  While  it  compelled  the  existing  private  creditor,  or  any  body 
who  should  grant  a  new  credit,  to  accept  payment  in  legal  tenders, 
it  did  not  assume  to  regulate  the  prices  of  commodities.  The  seller, 
therefore,  gradually  learned  to  represent  the  depreciation  of  the  cur- 
rency in  the  price  of  the  article  he  exchanged  for  it.  As  compared 
with  gold,  the  currency,  during  all  the  last  year  of  the  war,  was 
depreciated  to  between  forty  and  titty  cents  on  the  dollar,  touching 
at  its  lowest  point  thirty-five  cents  on  the  dollar. 

HOW  IT  RAISED  PRICES  BY  PROVOKING  SPECULATION. 

It  was  not  alone  by  the  direct  effect  of  the  depreciation  of  the 
currency  that  prices  were  acted  upon ;  speculation  was  engendered. 
Political  economy  takes  little  account  of  the  emotional  and  imagi- 
native nature  of  man.  In  long  periods,  with  numerous  instances, 
the  average,  deduced  as  a  law,  may  perhaps  discard  that  element. 
But  in  a  particular  instance,  or  at  a  particular  time,  it  is  often  very 
potent,  and  must  be  estimated  in  any  calculation  which  aims  at 
accuracy. 

After  a  period  of  rest  —  when  the  disposition  to  activity  begins 
to  revive  —  a  slight  circumstance  often  excites  a  speculation  that 
becomes  general.  The  opening  of  a  new  market,  an  apprehended 
deficiency  in  the  supply  of  a  commodity,  any  one  of  a  thousand 
circumstances,  may,  in  a  certain  state  of  the  public  mind,  be  a 
spark  to  kindle  a  blaze  of  speculation  throughout  the  commercial 
world.  How  much  more,  then,  might  it  have  been  expected  that 
such  a  governmental  policy  would  inspire  and  inflame  the  spirit  of 
speculation?  The  effect  was  greatest  during  the  process  of  a  new 
issue  of  currency,  or  while  it  was  anticipated.  After  the  issue  was 
completed,  there  was  generally  a  subsidence,  or  a  reaction. 


Governor's  Message. 


37 


AND  NEEDLESSLY  DOUBLED  THE  BURDEN  OF  THE  WAR. 

The  government  consumption  during  the  war  was  mostly  of  our 
domestic  products.  As  soon  as  the  channels  of  traffic  could  be 
adapted  to  the  new  points  of  consumption,  and  the  new  classes  of 
consumers,  there  was  no  more  difficulty  in  the  transfer  of  these 
products  from  producers  to  consumers  than  in  the  ordinary  opera- 
tions of  commerce  during  peace. 

Governments,  in  times  of  public  danger,  cannot  be  expected 
always  to  adhere  to  the  maxims  of  economical  science ;  the  few, 
who  would  firmly  trust  to  the  wisest  policy,  will  be  often  overborne 
by  the  advocates  of  popular  expedients  dictated  by  general  alarm. 
If  the  Federal  government  had  paid  out  treasury  notes,  not  made  a 
legal  tender,  in  its  own  transactions  whenever  it  was  convenient,  and 
redeemed  them  by  the  proceeds  of  loans  and  taxes  on  their  presen- 
tation at  a  central  point  of  commerce,  and  meanwhile  had  borrowed 
at  the  market  rates  for  its  bonds,  secured  by  ample  sinking  funds, 
founded  on  taxation,  and  had  supplemented  such  loans  by  all  neces- 
sary taxes,  the  sacrifices  would  not  have  been  half  that  required  by 
the  false  system  adopted,  perhaps  the  cost  of  the  war  would  not 
have  been  half  what  it  became. 

This  analysis  of  the  process,  by -which  the  changes  in  the  currency 
operated  to  produce  the  effect  on  prices  witnessed  by  the  people,  is 
necessary,  in  order  to  intelligently  discuss  the  problem  now  pressed 
upon  us.  For  the  fallacy  lurks  in  many  minds,  that  the  quantity  of 
the  currency,  even  when  it  has  become  stationary  and  quiescent, 
creates  by  its  direct  action,  a  state  of  prices  proportionate  to  that  in 
quantity. 

RELATION  OF  THE  QUANTITY  OF  CURRENCY  TO  THE  RANGE  OF  PRICES. 

But  this  fallacy  is  confuted  by  our  own  experience.  The  premium 
on  gold  fell  from  185  in  July,  1864,  to  29  in  May,  1865  ;  or  rather 
the  currency  rose  from  35  cents  to  77  cents  in  gold  value,  while  the 
amount  of  the  currency  remained  undiminished.  The  quantity  of 
the  currency  in  the  hands  of  the  public  —  taking  the  aggregate  of 
the  legal  tenders  and  the  bank  notes,  and  excluding  all  of  both 


38 


Governor's  Message. 


which  are  held  by  the  Treasury  or  by  the  banks  —  is  now  larger 
than  at  any  former  period.  The  existence  of  such  a  quantity  has 
not  arrested  the  tendency  to  a  general  fall  of  prices.  The  present 
inconveniences  in  business,  which  it  is  proposed  to  remedy  by  a  new 
issue  of  currency,  have  originated  and  gone  on  to  their  maturity, 
while  the  currency  was  being  distended  to  its  greatest  volume. 

EXCESS  OF  CURRENCY,  YET  FALLING  PRICES. 

An  excess  beyond  what  is  capable  of  being  used  for  the  business 
of  society  is  now,  for  the  first  time,  distinctly  indicated.  The  move- 
ment of  the  crops  in  the  last  autumn  — which  requires  something  like 
one-tenth  addition  to  the  ordinary  amount  —  created  no  stringency. 
The  banks  have  voluntarily  withdrawn  some  millions  of  their  circu- 
lation. It  is  probable  that  the  amount  capable  of  being  absorbed 
by  the  business  of  the  country  will  continue  to  fall  for  a  long 
period. 

WHEN  INFLATION  CANNOT  INFLATE. 

In  such  a  condition  of  business,  of  credit,  and  of  the  public  tem- 
per, a  new  issue  of  currency  would  not  cause  a  rise  of  prices,  unless 
it  were  so  excessive  as  to  occasion  speculative  depreciation,  or  dis- 
trust of  ultimate  redemption.  It  could  not  re-animate  the  dead 
corpse  of  exhausted  speculation.  A  period  of  quiescence  must 
ordinarily  precede  a  renewal  of  the  spirit  of  adventurous  enterprise. 

DISTRESS  FROM  FALLING  VALUES  AND  LACKING  CAPITAL. 

The  distress  now  felt  is  incident  to  the  continued  fall  of  values, 
which  is  the  descending  part  of  the  cycle  through  which  they  must 
pass  after  being  forced  up  to  an  unnatural  elevation.  The  want  felt 
is  a  want  of  capital  which  the  party  does  not  own,  and  has  not  the 
credit  to  borrow ;  not  a  lack  of  currency.  It  is  caused  by  invest- 
ments in  enterprises  which  have  turned  out  to  be  wholly  or  partially 
bad,  or  which  give  slower  returns  than  were  anticipated  —  by  too 
much  conversion  of  circulating  capital  in  fixed  capital  —  by  exces 
sive  undertakings  or  engagements,  induced  by  a  reliance  on  a  credit 
that  was  transient.    In  a  period  of  falling  prices,  good  property 


Governor's  Message. 


39 


becomes  less  convertible.  It  loses  its  circulatory  quality.  It  almost 
ceases  to  be  a  resource  to  obtain  money. 

HOW  DISTRESS  CANNOT  BE  CURED. 

These  inconveniences  would  not  be  removed,  if  the  government 
should  put  out  legal  tenders  and  take  in  a  corresponding  amount  of 
bonds,  or  if  a  bank  should  deposit  bonds,  and  receive  notes  in 
exchange.  Still  the  individual  distressed  for  the  want  of  capital 
would  have  no  additional  means  to  buy  or  borrow  these  new  issues, 
which  the  new  owner  would  obtain  only  by  paying  for  them.  A 
diminution  of  the  government  bonds  outstanding,  is  a  condition  of 
the  increase  of  legal  tenders  or  bank  notes.  If  an  embarrassed  per- 
son could  obtain  the  government  bonds  surrendered  or  deposited, 
he  would  be  as  much  relieved  by  his  power  to  dispose  of  them,  as 
he  would  by  a  power  to  dispose  of  the  legal  tenders  or  bank  notes. 
His  difficulty  is  that  he  is  equally  unable  to  obtain  either.  He  has 
not  the  means  to  buy,  or  the  credit  to  borrow,  them.  What  he  wants 
is  something  to  make  his  bad  investments  good  —  his  slow  invest- 
ments current ;  something  to  make  his  property  convertible  —  to 
impart  to  it  a  circulating  quality,  as  when  there  is  a  general  rise  of 
values  under  a  speculative  excitement,  and  everybody  is  disposed  to 
buy,  and  every  thing  finds  a  ready  market, 

INCREASE  OF  CURRENCY  CANNOT  CURE  DISTRESS. 

He  wants  something  to  create  in  others  a  disposition  to  buy,  in 
order  that  he  maybe  able  to  sell.  This  is  what,  in  the  present  state 
of  things,  an  increase  of  the  currency  will  not  do.  It  would  not 
act  mechanically  on  prices.  It  does  not  operate  by  physical  means. 
It  simply  influences  the  minds  of  men.  It  induces  them  to  buy,  and, 
in  the  effort  to  do  so,  they  bid  up  prices.  It  is  only  when  the  minds 
of  men  are  disposed  to  receive  an  impulse- toward  buying,  that  such 
an  effect  is  produced.  When  speculators  go  into  the  market  to 
influence  others  to  buy,  in  order  that  they  may  sell,  the  conference 
usually  ends  in  a  fall.  Even  when  speculators  go  into  the  market 
to  sell  on  an  event  expected  to  cause  a  rise,  the  result  is  commonly 
a  fall.    Everybody  cannot  get  out  at  once,  at  the  expense  of  others. 


40 


Governor's  Message. 


CHANGING  FORMS  AND  VARYING  VOLUME  OF  CIRCULATORY  CREDITS. 

The  amount  of  currency  required  by  the  needs  of  business  is  not 
to  be  decided  by  former  experience.  There  is  no  doubt  that,  on  the 
first  issue  of  legal  tenders,  they  were  largely  substituted  for  other  forms 
of  credit.  A  single  case  will  illustrate  :  The  sudden  rise  in  prices 
enabled  the  farmer  to  become  the  owner  of  the  floating  capital,  on 
which  his  next  year's  dealings  with  the  country  merchants  were  to  be 
carried  on.  The  habits  of  business  change  to  adapt  themselves  to  new 
conditions.  It  is  possible  that  the  government  might  cautiously 
follow  the  tendencies  of  trade,  and  retire  each  clearly  ascertained 
surplus  without  doing  any  harm.  But  a  withdrawal  of  any  consid- 
erable portion  of  the  amount  required  at  the  season  of  the  year 
which  creates  the  large  demand,  would  produce  serious  and  unneces 
sary  distress.  The  adoption  of  a  system  which  should  threaten  such 
a  result  would  be  very  mischievous.  The  Federal  Government  is 
bound  to  redeem  every  portion  of  its  issues  which  the  public  do  not 
wish  to  use.  Having  assumed  to  monopolize  the  supply  of  currency 
and  enacted  exclusions  against  everybody  else,  it  is  bound  to  furnish 
all  which  the  wants  of  business  require.  The  case  is,  as  if  the  gov- 
ernment should  undertake  to  monopolize  the  supply  of  lake  pro- 
pellers or  canal  boats  to  bring  grain  to  market.  If  it  should  not 
furnish  enough,  the  derangement  of  business  and  the  distress  of 
producers  and  consumers  would  be  intolerable.  While  securing 
redemption,  the  government  should  organize  a  system  which  pas- 
sively allows  the  volume  of  circulating  credits  to  ebb  and  flow, 
according  to  the  ever-changing  wants  of  business.  It  should  imi- 
tate, as  closely  as  possible,  the  natural  laws  of  trade  which  it  has 
superceded  by  artificial  contrivances. 

EASY  CONDITIONS  OF  RESUMING  SPECIE  PAYMENTS. 

The  ability  of  the  Federal  Government  to  resume  specie  pay- 
ments, is  thus  simply  a  question  of  its  command  of  resources  to  pay 
such  portions  of  the  circulating  credits  it  has  issued,  as  the  public 
not  wishing  to  use,  may  return  upon  it  for  redemption.  The 


Governor's  Message. 


41 


amount  to  be  paid  cannot  be  considered  large,  in  comparison  with 
its  financial  operations.  It  has  the  taxing  power,  and  by  reducing 
its  expenditure  could  accumulate  an  adequate  surplus.  It  has  the 
borrowing  power  and  good  credit.  It  can  make  permanent  loans 
and  pay  the  treasury  notes  which  are  returned  for  redemption.  It 
can  convert  them  or  fund  them  into  interest-bearing  securities.  In 
that  case,  they  would  cease  to  be  currency,  and  would  take  their 
place  among  investments  like  national,  state,  municipal,  railroad,  or 
other  corporate  bonds,  or  any  of  the  numerous  forms  of  moneyed 
securities,  of  which  many  thousand  millions  are  held  in  our  country. 
The  circulatory  quality,  in  securities  of  equal  general  credit,  is 
chiefly  a  question  of  the  rate  of  interest  they  bear. 

The  amount  of  coin  necessary  for  resumption  is,  first  an  adequate 
reserve  to  meet  the  demand  for  exportation,  for  which  the  treasury 
would  become  the  universal  reservoir ;  and  second,  a  surplus  suffi- 
cient fully  to  assure  the  people  that  the  treasury  supply  would  not 
be  exhausted.  The  power  to  command  coin  as  the  owner  of  foreign 
bills  of  exchange,  or  in  other  forms,  would,  to  a  large  extent,  be 
equivalent  to  possessing  coin.  Beyond  such  an  amount  of  coin,  the 
question  is  simply  a  question  of  capital. 

The  exact  time  of  actual  resumption,  the  process,  the  specific 
measures,  the  discreet  preparations  —  these  are  business  questions 
to  be  dealt  with,  in  view  of  the  state  of  trade  and  of  credit  opera- 
tions in  our  own  country,  the  course  of  foreign  commerce  and  the 
condition  of  the  exchanges  with  other  nations,  the  currents  of  the 
precious  metals,  and  the  stocks  from  which  a  supply  would  flow 
without  undue  disturbance  of  the  markets  of  other  countries.  These 
are  matters  of  detail,  to  be  studied  on  the  facts  and  figures.  They 
belong  to  the  domain  of  practical  administrative  statesmanship. 

RESUMPTION  LESS  COSTLY  THAN  PRESENT  IMPOLICY. 

It  is  quite  clear  that  the  problem  ought  to  be  worked  out,  with- 
out costing  the  country  any  thing  like  such  disturbance  in  its 
business  and  industries  as  the  operations  of  the  Federal  Govern- 
ment during  the  last  ten  years  have  repeatedly  created.  The 
6 


42 


Governor's  Message. 


natural  causes  which  affect  trade  may  be  foreseen,  and  all  dealers 
can  calculate  them  with  equal  advantages  in  every  thing,  except 
their  own  differences  in  intelligence  and  judgment.  But  the  action 
of  an  official  conducting  the  largest  financial  operations  in  the 
country,  and  exercising  dominion  over  the  circulatory  credits  that 
are  part  of  the  machinery  by  which  the  mass  of  private  transactions 
are  carried  on,  cannot  but  tend  to  create  in  all  industries,  uncertainty, 
confusion  and  miscalculation. 

nOW  PRESENT  IMPOLICY  HARASSES  ALL  BUSINESS  MEN. 

It  was  said,  after  the  revulsion  of  1837,  that  the  barometer  of  the 
money  market  of  America  hung  up  in  the  parlor  of  the  Bank  of 
England.  The  barometer  which  hangs  up  in  the  Treasury  Depart- 
ment at  Washington,  does  not  merely  indicate  conditions  and 
changes  of  the  financial  atmosphere;  it  creates  them.  Its  stormy 
vicissitudes  harass  the  business  of  the  whole  country. 

The  partial  cessation  of  productive  industries  and  the  partial 
want  of  employment  which  now  exists,  are  chiefly  produced  by  the 
fear  of  the  employers  that  if  they  carry  on  their  works,  they  may 
produce  at  a  loss.  The  abstinence  from  purchase  by  all  those 
classes  of  dealers,  who  buy  and  get  up  stocks  to  provide  for 
future  consumption,  is  chiefly  caused  by  the  fear  of  a  further  decline 
of  prices.  Under  these  apprehensions,  the  demand  is  much  less 
than  the  ordinary  consumption.  The  instant  manufacturers  or 
merchants  are  convinced  that  prices  have  reached  the  bottom,  even 
for  the  period  of  an  ordinary  business  operation,  they  will  begin 
to  resume  their  function  in  the  economy  of  trade.  The  wheels  of 
our  complex  industries  will  move,  workmen  will  find  employment, 
and,  with  revived  confidence  in  the  future,  prosperity  will  be 
renewed  in  its  sources.  Nothing  could  be  more  unwise,  more 
mischievous  in  its  ultimate  results,  than  to  interrupt  the  healing 
process  of  nature,  by  expedients  which  will  fail  of  affording  any 
real  relief,  and  will  be  certain  to  accumulate  new  materials  for 
another  catastrophe. 

It  has  seemed  to  me  fit  that,  on  this  occasion,  the  opinions  of  the 
great  Commonwealth  we  represent,  which  is  so  largely  interested 


Governor's  Message. 


43 


in  these  questions,  should  be  declared  on  the  side  of  sound  finance, 
public  integrity  and  national  honor ;  and,  in  making  this  com- 
munication the  medium  of  an  authentic  expression  on  the  subject,  I 
follow  the  example,  on  similar  occasions,  of  several  of  the  most 
illustrious  of  my  predecessors. 

RESULTS  DURING  TEN  YEARS  OF  PEACE. 

It  is  now  almost  ten  years  since  the  civil  war  ceased.  That 
period  ought  to  have  sufficed  to  renew  our  productive  industries,  to 
repair  the  waste  of  our  accumulated  capital,  and  to  restore  to  our 
people  a  sound  and  durable  prosperity.  But  an  indispensable  con- 
dition of  such  results  was  energy,  skill  and  economy  in  production, 
and  frugality  in  public  and  private  consumption. 

MISUSED  POWERS  OF  FEDERAL  GOVERNMENT. 

The  Federal  Government  has  all  the  while  been  the  greatest 
single  power  in  the  country  to  influence  results,  not  only  by  its  own 
vast  fiscal  operations,  its  dominion  over  the  currency  and  the  busi- 
ness of  banking,  and  the  effect  of  its  transactions  on  investments  of 
capital,  and  on  the  temporary  conditions  of  the  money  market,  but 
by  the  ascendancy  it  acquired  during  a  period  of  public  danger  over 
public  opinion  and  over  the  conduct  of  individuals.  It  is  to  be 
deplored  that  this  great  capacity  for  controlling  action  and  for  leader- 
ship has  not  conducted  us  to  better  results. 

The  period  has  been  characterized  by  unsound  public  finance,  an 
uncertain  policy  in  respect  to  the  currency,  a  series  of  speculative 
excitements  tending  to  unproductive  enterprises  and  unremunerative 
investments  of  capital,  and  terminating  in  distressing  reactions  in 
credit  and  business  ;  a  want  of  efficiency  and  economy  in  produc- 
tion, extravagance  in  public  and  private  expenditure,  enormous  taxa- 
tion and  complicated  systems  of  revenue — which  have  increased 
the  cost  and  wasted  the  fruits  of  that  taxation  and  rendered  capital 
and  labor  less  productive  —  and  frequent  spoliation  of  private  and 
public  trusts. 


•M 


Governor's  Message. 


GOVERNMENTS  TOO  COSTLY. 

In  the  decade  beginning  July  1,  1865,  the  people  will  have  paid 
in  taxes,  computed  in  currency,  seven  thousand  millions  of  dollars. 
Three-fifths  were  for  the  use  of  the  Federal  Government,  and  two- 
fifths  for  the  State  and  municipal  governments.  It  is  doubtless  true 
that  some  portions  of  the  municipal  expenditures  were  for  objects 
not  strictly  governmental.  But  it  cannot  be  questioned  that  much 
too  large  a  portion  of  the  whole  net  earnings  of  industry,  and  of 
the  whole  net  income  of  society,  is  taken  for  the  purpose  of  carrying 
on  government  in  this  country.  The  burden  could  more  easily  be 
borne  when  values  were  high,  and  were  ascending.  As  they  recede 
toward  their  former  level,  the  taxes  consume  a  larger  quantity  of 
the  products  which  have  to  be  sold  in  order  to  pay  them.  They 
weigh  with  a  constantly  increasing  severity  upon  all  business  and 
upon  all  classes.  They  shrivel  up  more  and  more  the  earnings  of 
labor.  This  condition  of  things  ought  to  admonish  us,  in  oui 
respective  spheres,  to  be  as  abstinent  as  possible  in  appropriations 
for  public  expenditures.  If  the  cost  of  government  in  our  country  ^ 
were  reduced,  as  it  ought  to  be,  one-third,  it  would  still  be  larger 
than  a  few  years  ago,  taking  account  of  the  prices  of  the  products, 
which,  in  order  to  pay  that  cost,  we  are  compelled  to  convert  into 
money. 

TAXATION  TOO  BURDENSOME  THE   PROSTRATION  OF  THE  SOUTH. 

The  people  are  less  able  to  bear  such  taxation  by  reason  of  the 
want  of  efficiency  and  economy  in  production,  and  the  want  of 
frugality  in  consumption,  generated  by  the  causes  already  indicated, 
and  also  by  reason  of  the  failure  to  completely  renew  the  produc- 
tive energies  and  activities  of  the  States  of  the  South,  which  fur- 
nish about  half  of  the  exportable  commodities  of  the  country, 
other  than  specie ;  which  are  large  consumers  of  our  manufactures 
and  productions,  and  which  make  us  their  carriers,  merchants  and 
bankers  in  all  their  domestic  and  foreign  transactions. 

It  has  been  proudly  ascribed  to  the  humanity  of  our  age  that, 
since  the  surrender  at  Appomatox,  not  one  life  has  been  sacrificed 


Governor's  Message. 


45 


to  the  policy  of  the  victorious  government.  It  is  to  be  wished  that 
we  were  equally  free  from  the  criticisms  that  the  retribution  visited 
upon  our  former  adversaries  merely  conforms  to  the  higher  modern 
estimate  of  property,  as  compared  with  life  ;  that  exercising  amoral 
coercion,  invigorated  by  a  standing  menace  of  military  force,  we 
have  held  those  communities  bound  in  writhes,  to  be  plundered  by 
rulers  destitute  of  support  in  their  public  opinion,  and  without  title 
to  our  own  respect  or  trust. 

FINAL  ACCEPTANCE  OF    AMENDMENTS  TO  FEDERAL  CONSTITUTION. 

Such  has  been  our  course,  after  and  in  spite  of  the  fact  that  these 
our  kindred,  in  a  common  ancestry,  a  common  heritage  and  a  com- 
mon future,  had  joined  at  national  conventions  in  the  nomination 
of  candidates  and  in  the  declaration  of  principles  and  purposes, 
which  form  an  authentic  acceptance  of  the  results  of  the  war,  em- 
bodied in  the  last  three  amendments  to  the  organic  law  of  the  Fed- 
eral Union,  and  that  they  had  by  the  suffrages  of  all  their  voters,  at 
the  last  national  election,  completed  the  proof  that  now  they  only 
seek  to  share  with  us  and  to  maintain  the  common  rights  of  Ameri- 
can local  self-government,  in  a  fraternal  union,  under  the  old  flag 
with  "  one  Constitution  and  one  destiny." 

There  should  be  no  misunderstanding  as  to  this  position  of  our 
Southern  brethren,  or  of  any  portion  of  our  fellow-citizens.  The 
questions  settled  by  the  war  are  never  to  be  re-opened. 

The  adoption  of  the  XHIth,  XlVth,  and  XVth  amendments 
to  the  Federal  Constitution  closed  one  great  era  in  our  politics.  It 
marked  the  end  forever  of  the  system  of  human  slavery,  and  of  the 
struggles  that  grew  out  of  that  system.  These  amendments  have 
been  conclusively  adopted,  and  they  have  been  accepted  in  good 
faith  by  all  political  organizations,  and  the  people  of  all  sections. 
They  close  the  chapter,  they  are  and  must  be  final ;  all  parties  here- 
after must  accept  and  stand  upon  them,  and  henceforth  our  polities 
are  to  turn  upon  questions  of  the  present  and  the  future,  not  upon 
those  of  the  settled  and  final  Past. 


46 


Governor's  Message. 


THE  PEOPLE  MUST    AGAIN    ATTEND    TO   PUBLIC  AFFAIRS. 

The  nobler  motives  of  humanity  concur  with  our  interests  in 
making  us  hail,  with  heartfelt  congratulations,  a  real  and  durable 
peace,  between  populations  unnaturally  estranged.  The  time  is 
ripe  to  discard  all  memories  of  buried  strifes,  except  as  a  warning 
against  their  renewal  ;  to  join  altogether  to  build  anew  the  solid 
foundations  of  American  self-government.  For  nearly  a  generation, 
the  controversies,  which  led  to  fratricidal  conflict,  have  drawn  awny 
the  attention  of  the  people  from  the  questions  of  administration, 
which  involve  every  interest  and  duty  of  good  government.  The 
culture,  the  training  and  the  practice  of  our  people  in  the  ordinary 
conduct  of  public  affairs,  have  been  falling  into  disuse.  Meanwhile 
the  primitive  simplicity  of  institutions  and  of  society,  in  which 
government  was  little  felt,  and  could  be  neglected  with  comparative 
impunity,  has  been  passing  away.  If  public  necessities  must  wring 
so  much  from  the  earnings  of  individuals,  taxation  must  become 
scientific.  In  our  new  condition  all  the  problems  of  administration 
have  become  more  diincult.  They  call  for  more  intellect  and  more 
knowledge  of  the  experience  of  other  countries.  They  need  to 
become  the  engrossing  theme  of  the  public  thought  in  the  discus- 
sions of  the  press  and  in  the  competition  of  parties,  which  is  the 
process  of  free  institutions.  The  people  must  once  more  give  their 
minds  to  questions  that  concern  the  ordinary  conduct  of  govern- 
ment, if  they  would  have  our  country  to  start  afresh  in  a  career 
of  prosperty  and  renown. 

SAMUEL  J.  TILDEN. 


APPENDIX. 


BANKS. 

On  the  first  day  of  October  last,  eighty-one  banks  were  doing  busi- 
ness under  the  laws  of  this  State.  During  the  fiscal  year  then  ended, 
five  banks  were  organized,  and  four  were  closed,  one  of  which  failed. 
Of  the  five  banks  created,  three  were  organized  with  less  than  one 
hundred  thousand  dollars  of  capital  each,  under  chapter  126  of  the 
Laws  of  1874. 

Circulating  notes  to  the  amount  of  $6,368,  were  destroj^ed  by  the 
Bank  Department  during  the  year.  Sixty-seven  banks  were  cred- 
ited with  lost  circulation,  to  the  amount,  in  all,  of  $285,559  the  time 
for  redeeming  the  same,  after  the  usual  legal  notice,  having  expired. 
The  amount  of  circulation  outstanding,  including  that  of  incorpo- 
rated banks,  banking  associations,  and  individual  bankers,  was,  on 
the  first  day  of  October  last,  $1,105,189.50.  Of  this  amount,  the 
sum  of  $367,438  was  secured  by  deposits  of  cash,  stocks,  or  bonds 
and  mortgages.  The  residue,  $737,751.50  is  not  secured,  it  having 
been  isued  prior  to  the  passage  of  the  general  banking  law.  Steps 
have  been  taken  by  twelve  banks  for  the  fiscal  redemption  of  $160,- 
301  of  these  unsecured  notes,  in  accordance  with  the  provisions  of 
chapter  585  of  the  laws  of  1873. 

SAVINGS  BANKS. 

One  hundred  and  fifty-six  savings  banks  (two  of  which  were 
closing),  reported  to  the  Bank  Department  on  the  first  day  of  July 
last.  Their  assets,  in  the  aggregate,  amounted  to  $316,122,790, 
having  increased  during  the  year  then  ended  $1,367,020.  The 
increase  in  assets  during  the  first  six  months  of  1874  was  $8,553,060. 
The  number  of  persons  having  deposits  in  these  institutions  was. 


48 


Governor's  Message. 


according  to  the  number  of  open  accounts  January  1,  1874,  $Sj9,472, 
being  an  increase  of  16,830,  during  the  year. 

TRUST,  LOAN  AND  INDEMNITY  COMPANIES. 

On  the  first  day  of  July  last,  twelve  trust,  loan  and  indemnity 
companies  reported  to  the  Bank  Department,  under  chapter  324  of 
the  laws  of  1874.  The  aggregate  of  capital  paid  in,  as  shown  by 
their  reports,  was  $11,752,040,  and  the  amount  due  to  their  deposi- 
tors was  $38,479,764. 

INSURANCE  DEPARTMENT. 

The  number  of  insurance  companies,  subject  to  the  supervision 
of  the  Insurance  Department,  on  the  first  day  of  December,  1874, 
was  2S2,  as  follows : 


New  York  Joint  Stock  Fire  Insurance  Companies   102 

New  York  Mutual  Fire  Insurance  Companies   8 

New  York  Marine  Insurance  Companies   9 

New  York  Life  Insurance  Companies   20 

New  York  Plate  Glass  Insurance  Company   1 

Fire  Insurance  Companies  ol  other  States   87 

Marine  Insurance  Companies  of  other  States   1 

Life  Insurance  Companies  of  other  States   27 

Casualty  Insurance  Companies  of  other  States   4 

Canadian  Fire  Insurance  Companies   3 

Foreign  Fire  Insurance  Companies    11 

Foreign  Marine  Insurance  Companies   3 


Total   282 


The  total  amount  of  stocks  and  mortgages  held  by  the  Insurance 
Department  for  the  protection  of  policy  holders  of  Life  and  Casu- 
alty Insurance  Companies  of  this  State,  and  of  foreign  insurance 
companies  doing  business  within  it,  was  §10,404,593,  as  follows : 


Governor's  Message.  49 

For  protection  of   policy  holders  generally,  in 
Life  Insurance  Companies  of  this  State   S3,  689,  S91  00 

For  protection  of  registered  policy  holders  exclu- 
sively  3,  250,  842  00 

For  protection  of  casualty  policy  holders  exclu- 
sively  1,000  00 

For  the  protection  of  plate  glass  policy  holders  0 
exclusively   50,  000  00 

For  protection  of  fire  policy  holders  in  Insurance 

Companies  of  other  States    40,  000  00 

For  protection  of  fire  policy  holders  in  Insurance 

Companies  of  Canada    600, 120  00 

For  protection  of  fire  policy  holders  in  foreign 

Insurance  Companies   2,  473, 100  00 

For  protection  of  life  policy  holders  in  foreign 

Insurance  Companies   300,  000  00 

Total  deposit   $10,  404,  953  00 


QUARANTINE. 

During  the  past  year,  fifty-seven  vessels  arrived  at  the  port  of 
is  ew  York,  in  which,  during  the  passage,  or  while  in  port,  sickness 
had  occurred,  rendering  them  subject  to  quarantine  detention 
Eight  vessels  had  eleven  cases  of  small-pox  on  board,  from  which 
3,228  persons  had  been  exposed  to  the  disease ;  one  hundred  and 
twenty-one  cases  of  yellow  fever  occurred  on  forty-four  vessels 
bound  for  New  York,  and  twelve  patients  with  this  disease  reached 
the  port,  and  were  cared  for  at  the  Dix  Island  Hospital,  of  whom 
two  died ;  and  five  cases  of  ship  fever  were  removed  by  the  health 
officer  to  the  hospital.  No  cases  of  cholera  occurred  in  the  port, 
but  several  vessels  arrived  from  ports  infected  with  this  disease,  on 
three  of  which  coming  from  India,  deaths  from  cholera  occurred 
during  the  passage.  No  new  disease  called  for  any  action  by  the 
health  officer. 

During  the  year,  an  epidemic  of  malignant  yellow  fever  raged 
in  Havana  with  unprecedented  violence,  and  prevailed  in  Rio 
Janeiro  and  in  twelve  other  South  American  and  West  Indian  ports, 
and  also  in  Pensacola  and  some  other  Southern  ports  of  the  United 


50 


Governor's  Message. 


States,  having  extensive  and  direct  communication  with  New  York 
In  Havana,  the  deaths  from  yellow  fever  reached  the  enormous  ex- 
tent of  eighty  per  cent  of  the  persons  attacked,  and,  in  some  cases, 
vessels  lying  in  that  harbor  during  the  summer  lost  all  their  crews 
except  one  or  two.  It  is  worthy  of  notice,  that  while  in  previous 
years  nearly  nine-tenths  of  all  cases  of  yellow  fever  came  from  the 
port  of  Havana,  so  small  a  number  reached  here  during  the  present 
year.  This  result,  in  the  opinion  of  the  health  officer,  is  largely 
due  to  the  sanitary  precautions  taken  by  the  officers  of  the  vessels, 
most  of  whom,  being  connected  with  regular  lines,  are  becoming 
familiar  with  the  quarantine  regulations  of  the  port,  and  with  the 
rigid,  though  reasonable,  restrictions  to  which  vessels  having  infec- 
tious diseases  on  board  are  subjected. 

During  the  quarantine  season,  1,135  vessels  arrived  at  quarantine 
from  suspected  ports ;  of  these,  236  were  from  ports  known  to  be 
infected,  and  were  detained ;  and  68  were  required  to  discharge 
their  cargoes  on  lighters  in  the  stream  before  going  to  the  city. 


EMIGRATION. 

The  following  table  shows  the  statistics  of  emigration  for  the  last 
fifteen  years : 


a 

_o 

■•a 
ed 

niv 

:-  J1 
C  w;£ 

«3 
3 

cS 

U  03  —  -A 

3-g  §  s 

e 

© 

£  © 

liens 

"2  ■  Z.  ■ 

o 

< 

£ u  ' 

1860... 

$2  00-100 

105, 162 

4,729 

1861... 

do 

65,529 

5,079 

1862.. 

do 

76,306 

3,247 

1863... 

do 

156,844 

4,911 

1864... 

do 

182,916 

7,363 

1865... 

do 

196,352 

7,425 

1866... 

do 

233,418 

10,306 

1867... 

2  50-100 

242,731 

13,237 

1868... 

do 

213,686 

14,250 

1869... 

do 

258,989 

13,911 

1870... 

do 

212, 170 

16, 601 

1871... 

1  50-100 

229,639 

14,369 

1872... 

do 

294,581 

15,818 

1873... 

do 

266,818 

12,942 

1874*.. 

do 

135,323 

6,300 

Totals 

2, 870,464 

150,488 

$289,467  92 
175,434  56  I 
174,454  29  | 
341,027  00  i 
420.366  17 
471,034  85 
532,048  20 
583,154  40 
577,349  36 
695,499  59 
566, 119  26 
421,957  40 
457,011  70 
415.063  28 
214,631  34 


£  0 
Z  5 

-  - 


$217,717  53 
178,401  77 
138,501  56 
168,155  71 
373,763  39 
447,580  20 
545,983  21 
538,577  22 
662,9.58  12 
606,158  58 
605,544  24 
605,904  17 
598,793  78 
466, 108  22 
299,035  14 


•-  ©    _  j 


Z  r.  Z  z  £  ~     ~  - 


'-  © 


$1:32,4.50  00 
199,559  67 
193,937  06 
133,695  17 
125,769  74 
96.852  13 
54,784  98 
96,419  47 
129,765  07 
61, 188  46 
22, 129  45 


$6,334,619  32  $6,445,205  84  $1,246,551  20 


o  %  /.  .=  — 


$58, 869  OS 
19,855  93 
16,016  06 
15, 792  22 
19,349  71 
14.320  74 
52, 940  24 
33,945  87 

+101, 737  20 
48,846  66 
51,681  15 
39,829  58 
51,556  81 
32,678  24 


$557,419  49 


*  For  eleven  months. 


+  This  sum  included  back  claims. 


Governor's  Message. 


51 


PRESENT  FINANCIAL  CONDITION  OF  THE  COMMISSION. 


The  indebtedness  of  the  Board  is  as  follows : 
Due  the  Equitable  Life  Assurance  Society,  amount 
borrowed  on  bond  and  mortgage  of  the  lands  at 

Ward's  Island   $100,000  00 

Due  the  counties  and  charitable  institutions  of  the 
State,  for  the  care  and  support  of  emigrants  during 
the  past  one  and  one-half  years    75,  000  00 


Due  for  current  expenses  at  Castle  Garden   16,  000  00 

Estimated  expenses  of  the  Castle  Gar- 
den and  Ward's  Island  establishments 


for  the  month  of  December  (includ- 
ing $10,000  due  for  coal)   $30,  000  00 

Less  cash  on  hand  and  estimated  re- 
ceipts   20,  000  00 

 $10,  000  00 


Total  estimated  indebtedness  December  31,  1874 . .  $201,  000  00 


The  number  of  emigrants  at  present  cared  for  at  Castle  Garden 
and  Ward's  Island  is  1,041,  and  in  the  counties  about  900.  During 
the  months  of  January  and  February,  the  number  to  be  cared  for 
at  Ward's  Island  will  increase  to  about  2,000,  and  in  the  coun 
ties  to  more  than  1,200.  On  the  first  of  January  next  the  commis- 
sioners will  practically  be  without  funds  to  care  for  these  persons. 
The  expenses  of  the  Ward's  Island  and  Castle  Garden  institutions 
will,  during  the  months  of  J anuary  and  February,  be  about  $25,000 
per  month,  while  the  receipts  will  not  exceed  $5,000  per  month. 

COMMON  SCHOOLS. 

The  statistics  of  the  common  schools  for  the  year  ending  Septem- 
ber, 30,  1874,  are  as  follows  : 

Total  receipts,  including  balance  on  hand  Sep- 
tember 30,  1873   $11,  944,  023  38 

Total  expenditures   10,779,779  61 

Amount  paid  for  teachers'  wages   7,  559,  090  59 


52 


GovEBtfOB's  Message. 


Amount  paid  for  school-houses,  repairs,  furni- 
ture, etc   $1,721,  2S2. 64 

Estimated  value  of  6chool-houses  and  sites   28,  714,  738  00 


Total  number  of  school-houses   11,  775 

Number  of  school  districts,  exclusive  of  cities   11,  299 

Number  of  teachers  employed  at  the  same  time  for 

the  full  legal  term  of  school   18,  554 

Number  of  teachers  employed  during  any  portion 

of  the  year   29,  683 

umber  of  children  attending  public  schools   1,  039,  097 

Number  of  persons  attending  normal  schools   6,  568 

Number  of  children  of  school  age  in  private  schools. .  138,  610 

Number  of  volumes  in  school  district  libraries   835,  882 

Number  of  persons  in  the  State  between  5  and  21 

years  of  age   1,  501,  874 


COLLEGES  AND  ACADEMIES. 

The  condition  of  the  colleges  and  academies,  subject  to  the  visi- 
tation of  the  Regents  of  the  University,  is  very  satisfactory. 

There  are  within  the  State,  22  literary  colleges,  10  medical  col- 
leges, and  240  academies  and  academical  departments  of  union 
schools.  With  several  of  the  colleges  included  in  this  enumeration, 
are  connected  special  schools  of  law,  of  medicine,  and  of  other 
branches  of  science.  By  the  wise  liberality  of  individual  citizens, 
the  endowments  and  appliances  of  several  of  these  institutions  have, 
during  the  last  year,  been  largely  increased,  and  their  means  of  use- 
fulness greatly  extended.  The  number  of  scholars  in  attendance 
upon  the  academies  has  increased,  and  the  standard  of  scholarship 
has,  upon  the  whole,  considerably  advanced.  These  institutions, 
while  they  prepare  students  for  admission  to  the  colleges,  are  also 
designed  to  fit  another  class  for  immediate  entrance  upon  the 
practical  duties  of  life,  and,  thus  complementing  the  work  of  the 
common  scheols,  form  an  important  part  of  the  educational  institu- 
tions of  the  State. 

STATE  LIBRARY  AND  MUSEUM. 

The  State  Library,  in  both  its  departments,  has  been  enlarged  by 
the  application  of  all  the  means  at  the  disposal  of  the  Trustees.  In 


Governor's  Message. 


53 


the  extent  and  value  of  its  contents,  it  is  a  source  of  just  pride  to 
the  people  of  the  State.  The  law  library  numbers  about  26,000 
volumes,  and  the  general  library  about  68,000,  including  many 
rare  and  valuable  works. 

The  State  Museum  of  Natural  History,  under  the  management  of  - 
its  able  curator,  Prof.  Hall,  is  reported  to  be  in  excellent  condition, 
and  exhibits  the  productions  of  the  State,  in  a  manner  to  afford  to 
the  student  of  natural  science  most  valuable  aid  in  his  studies. 

THE  NATIONAL  GUARD. 

The  National  Guard  consists  of  eight  divisions,  containing  nine- 
teen brigades,  composed  of  one  regiment  and  nine  separate  troops 
of  cavalry,  one  battalion  and  ten  batteries  of  artillery,  thirty  regi- 
ments and  thirteen  battalions  of  infantry.  Total  officers,  non-com- 
missioned officers,  musicians  and  privates  (three  brigades  estimated), 
twenty  thousand  live  hundred  and  thirty-two  (20,532). 

SOLDIERS  OF  WAR  OF  1812. 

The  last  Legislature  made  an  additional  appropriation  of  one  hun- 
dred thousand  dollars  ($100,000),  for  redeeming  certain  certificates 
issued  to  soldiers  of  the  war  of  1812. 

The  former  appropriation  paid  on  the  certificates  allowed 
$91.52^  on  $100  of  principal. 

The  appropriation  of  1874  paid  the  balance  due  on  the  principal, 
and  $46.72  on  $100  of  interest. 

WAR  CLAIMS  AGAINST  THE  UNITED  STATES. 

On  the  1st  day  of  January,  1874,  the  unsettled  balance  in  favor 
of  the  State  was  $1,209,286.11.  Since  that  time  another  install- 
ment of  over  $34,000  has  been  presented  to  the  Treasury  Depart- 
ment. In  the  unsettled  balance  above  stated  is  included  a  claim  for 
$131,188.02,  interest  on  Comptroller's  bonds,  which  cannot  be  paid 
without  legislative  action. 


54 


Governor's  Message. 


SALT  SPRINGS. 

The  quantity  of  salt  from  the  Onondaga  Salt  Springs,  inspected 
during  the  last  fiscal  year,  was  6,594,191  bushels,  less  by  1,304,981 
bushels  than  the  production  of  the  preceding  year.  The  net  reve- 
nue from  this  source  was  $10,341.07,  showing  a  falling  off,  as  com- 
pared with  the  preceding  year,  of  $11,424.08. 

STATE  PRISONS. 

The  following  statement  shows  the  expenditures  and  earnings  of 
each  of  the  prisons,  for  the  year  ending  September  30,  1874 : 


Advances  from  Received  from  Excess  of  Ex- 

the  Treasury.  Earnings.  penditures. 

Auburn                         $233,105  90  $101,910  40  $131,256  50 

Clinton                            337,078  12  153,473  00  184,204  52 

Sing  Sing                        300,054  58  124,009  43  230,045  15 

Miscellaneous*     37,031  25 


$930,899  60    $379,393  43    $588,537  42 


In  1867,  the  excess  of  advances  from  the  Treasury 

over  receipts  from  earnings,  was   $300,874  79 

In  1808,  it  was   512,547  74 

In  1809,  it  was   595,774  45 

In  1870,  it  was   401,304  99 

In.  1871,  it  was   470,309  23 

In  1872,  it  was   405,881  84 

In  1873,  it  was   597,289  00 

In  1874,  it  was   588,537  42 


The  number  of  convicts  in  each  of  the  prisons,  September  30, 
1874,  was  as  follows : 

Auburn   1,202 

Clinton   552 

Sing  Sing   1,300 


3,000 

Total,  September  30,  1873   3,025 


*  Miscellaneous  expenditures,  not  distributed,  including  $26,231.25  for  transportation  of 
convicts. 


E 


I 


